Tag: collectivism

Cultural Values and the Negotiation Table: Unlocking the Impact of Individualism vs. Collectivism, Hierarchy, and Uncertainty Avoidance

Posted on by Leave a comment

Negotiation, the art of reaching agreements, is not merely a transactional exchange of offers and counteroffers; it’s a complex dialect of cultural values, beliefs, and norms. 

Understanding how cultural values influence negotiation outcomes is essential for achieving results in the global arena. 

So, let’s take a look at the impact of cultural values such as individualism versus collectivism, hierarchy, and uncertainty avoidance on negotiation strategies and outcomes.

Individualism vs. Collectivism

Welcome to the boardroom.

On one side of the table: a U.S. company; on the other: a Japanese firm. 

While discussing a joint venture, their priorities differ, based on their individualist versus collectivist values.

The American negotiators emphasize their company’s strengths and seek to secure the best possible deal for their organization. 

The Japanese negotiators prioritize building trust, fostering mutual respect, and ensuring alignment with their company’s broader goals and values.

One of the most fundamental cultural dimensions impacting negotiation is the degree of individualism versus collectivism within a society. 

In individualistic cultures like the United States, negotiation is often approached from a competitive standpoint, with an emphasis on individual goals, autonomy, and personal achievement. 

Negotiators may prioritize their own interests and seek to maximize their outcomes, even at the expense of others.

Conversely, in collectivistic cultures such as Japan or China, negotiation is viewed through a communal lens, emphasizing harmony, cooperation, and group cohesion. 

Negotiators may focus on building relationships, consensus-building, and ensuring the well-being of the collective. 

In these cultures, concessions may be made to preserve group harmony and maintain long-term relationships.

Hierarchy

The boardroom, round two.

On one side: a German company; on the other: a Brazilian company.

While discussing a partnership agreement, their priorities differ based on their views of hierarchy.

The German negotiators expect a collaborative approach, with decisions made based on merit and expertise rather than hierarchical considerations. 

The Brazilian negotiators defer to senior executives and prioritize building rapport and respect for authority.

Hierarchy, or the degree of social stratification within a society, significantly influences negotiation dynamics. 

In hierarchical cultures like those found in many Asian and Latin American countries, respect for authority, status, and seniority plays a central role in negotiation interactions. 

Negotiators may defer to higher-ranking individuals, and decisions may be made by those in positions of authority.

In contrast, in egalitarian cultures such as those in Northern Europe or Australia, negotiation tends to be more egalitarian, with an emphasis on equality, meritocracy, and consensus-building. 

Negotiators may engage in open dialogue, challenge assumptions, and seek input from all stakeholders, regardless of rank or status.

Uncertainty Avoidance

The boardroom, round three.

On one side: a Swedish company; on the other: a Saudi Arabian company.

While discussing a business partnership, their priorities differ based on their level of uncertainty avoidance.

The Swedish negotiators are more open to exploring creative solutions and adapting to changing circumstances. 

The Saudi negotiators prefer clear agreements, detailed contracts, and a structured approach to minimize uncertainty and risk.

Uncertainty avoidance, or the degree to which a culture tolerates ambiguity and uncertainty, shapes negotiation outcomes. 

In cultures with high uncertainty avoidance, such as those found in many Asian and Middle Eastern countries, negotiators may prefer clear rules, detailed contracts, and predictable outcomes. 

Negotiation strategies may focus on minimizing risk and ensuring stability.

Conversely, in cultures with low uncertainty avoidance, such as those in the United States or Northern Europe, negotiators may be more comfortable with ambiguity and uncertainty. 

Negotiation approaches may be more flexible, adaptive, and open to innovative solutions, with less emphasis on rigid rules or formalities.

Come to the Negotiation Table Prepared

Cultural values – particularly individualism vs collectivism, hierarchy, and uncertainty avoidance – play a profound role in shaping negotiation outcomes, influencing everything from communication styles to decision-making processes. 

By understanding and respecting cultural differences, negotiators can adapt their strategies and approaches to navigate diverse cultural landscapes successfully.

Are You Computer-Literate? Your Proficiency May Have Something to Do with Your Culture

Posted on by Leave a comment

Does your culture impact your web skills?

How about the way you perceive web advertising?

Last week, we talked about what types of advertising appeal to horizontal and vertical cultures.

This week, we’ll take a closer look at cultural distinctions among web users, including individuals’ media consumption patterns, web proficiency, challenges faced, and their overall stance on web-based advertising.

Cultural Orientations

The conventional understanding of individualism and collectivism, typically framed as opposing concepts on a binary spectrum, warrants a more nuanced and comprehensive approach.

Recent research has shed light on the limitations of the conventional unidimensional viewpoint, leading to the emergence of a more intricate classification known as Vertical and Horizontal Individualism and Collectivism (Triandis, 1995, 2001). 

As we saw with the study last week, this four-fold classification framework offers a valuable instrument for investigating the potential role of cultural orientations in shaping people’s attitudes and behaviors towards media and persuasive communications.

This empirical study employs this four-fold classification to scrutinize cultural predispositions within an individualistic culture, coupled with people’s responses to persuasive communication on the Web.

The Study

In the course of an online survey administered to web users, this study’s findings reveal that these unique cultural orientations wield discernible effects on people’s perceived web skills and their attitudes toward web advertising, both in broad and specific contexts. 

Overall, respondents in the four groups shared similarities in media usage patterns and reported no significant differences in perceived challenges related to the Web. 

However, when it came to perceived Web skills, those with a strong horizontal individualistic orientation appeared to hold a perception of higher skill levels compared to the other groups. 

Web Advertising

What truly stands out is the intriguing revelation that individuals with diverse dominant cultural orientations indeed exhibit varying general attitudes toward Web advertising. 

Notably, the four groups also differed in their perceptions of the informativeness and entertainment value of Web advertising. 

Strikingly, those with a pronounced horizontal individualistic orientation tended to express more negative opinions regarding Web advertising, deeming it less informative and less entertaining than their counterparts.

The idea that individuals with high horizontal individualism may perceive Web advertising as targeting a mass audience rather than catering to their personal uniqueness is intriguing. 

These respondents also reported the highest Web skills among the groups, perhaps driven by their desire to control what they view on the Web and customize persuasive messages to satisfy their quest for individuality.

In sum, these findings underscore the pivotal role of cultural orientations in shaping consumer predispositions towards persuasive communications on the Web. 

In addition to individual attributes like Web skills and knowledge, cultural values and orientations can be regarded as a foundational and steadfast underpinning for shaping beliefs and attitudes. 

These cultural predispositions play a critical role in influencing an individual’s outlook on a wide range of topics, their motivations, objectives, and behaviors.

Horizontal/Vertical Cultures & Advertising: Does Status, Pleasure, or Relationships Appeal to Your Culture?

Posted on by Leave a comment

The glossy page of an in-flight magazine shows an ad of a woman running while clutching a sleek new mobile phone.

Several passersby turn to watch her run past.

The ad reads “Turning heads with America’s Slimmest Phone!”

Does this ad appeal to you?

Would it appeal generally to the people of your culture?

While it’s not uncommon to encounter advertisements promising to elevate a consumer’s status and leave a lasting impression on others, the role of culture in shaping the resonance of such appeals cannot be understated. 

The degree to which such advertisements motivate consumers may vary depending on the cultural context.

This study set out to explore the influence of culture on the use of persuasive appeals highlighting the allure of status benefits and various other advantages.

The Study’s Hypotheses

The study’s hypotheses stem from a nuanced consideration of cultural distinctions, particularly the contrast between horizontal cultures, which value equality, and vertical cultures, which emphasize hierarchical structures. 

The researchers argued that this cultural distinction offers a unique lens through which to make predictions, revealing insights not traditionally associated with broader cross-cultural differentiations between individualism and collectivism.

The delineation between vertical cultures and horizontal cultures offers a fresh perspective on the prevalence and content of advertising appeals. 

The Study

Through a comprehensive content analysis encompassing 1,211 magazine advertisements across five diverse countries (Denmark, Korea, Poland, Russia, and the United States), researchers uncovered distinct patterns in ad content that underscore the significance of this cultural distinction.

In their in-depth examination, they delved into these ad content patterns and their implications. 

They undertook a comparative analysis, pitting the predictions derived from the vertical/horizontal cultural distinction against those derived from the broader individualism-collectivism framework, ultimately subjecting these predictions to empirical testing.

Notably, the analysis revealed variations in the emphasis on status benefits and uniqueness benefits within advertisements, mirroring the countries’ categorization as vertical or horizontal cultures.

The Results

The study’s comprehensive analysis of magazine advertisements spanned several countries, each representing distinct cultural orientations, including VI (United States), HI (Denmark), and VC (Korea, Russia, Poland).

Researchers noted a distinct emphasis on status-related benefits within advertising appeals in countries aligned with VC cultures, which includes Korea, Russia, and Poland, as well as the VI culture in the United States. 

This emphasis encompassed depictions of luxury, references to prestige, impressing others, prominence, affiliations with high-status groups (e.g., ivy league graduates), endorsements by high-status individuals (e.g., celebrities), and other forms of distinction (e.g., “award-winning”). 

This focus on status benefits corresponded with the cultural profiles of these countries. 

Notably, in all VC societies examined, status benefits emerged as a dominant theme in advertising, often overshadowing appeals emphasizing pleasure, uniqueness, or relationships. 

In stark contrast, the emphasis on pleasure appeals was preferred in the HI culture of Denmark.

Uniqueness-related appeals, which included elements of differentiation, self-expression, self-reliance, and novelty, were also more prominent in HI cultures compared to VI and VC cultures. 

These appeals portrayed the product as a means of self-expression, aligning with cultural contexts emphasizing individuality, distinctiveness, and self-reliance.

Notably, although both the United States and Denmark are categorized as individualistic societies, their advertisements significantly differed in their emphasis on uniqueness and status, reflecting the nuances of their vertical and horizontal cultural values. 

These patterns were not anticipated by conventional analyses based on the broader individualism-collectivism classification.

As expected, the prevalence of ads emphasizing pleasure benefits largely corresponded to the individualism-collectivism orientation of the society. 

These appeals, which cater to personal hedonic goals valued in individualistic cultures, were more prevalent in individualistic societies than in collectivistic ones, with the contrast between HI and VC cultures proving particularly significant.

However, no significant differences emerged across individualistic and collectivistic cultures in regard to relationship appeals, which focused on sociability, nurturing, warmth, and belongingness. 

Overall, the study found that the conventional individualism-collectivism framework falls short in predicting the prevalence of such appeals, making the horizontal/vertical cultural distinction a valuable addition to cross-cultural theory and research.

Coronavirus: How Did Culture Impact Compliance?

Posted on by Leave a comment

The coronavirus pandemic taught us many things about human nature.

We are a social people. Toilet paper is important. And many people hate covering their face.

It also showed us that the way different countries dealt with the pandemic proved more or less effective and largely dependent upon compliance from the population.

New research aimed to explore attitudes towards health compliance and psychological responses within the context of cultural frameworks of individualism and collectivism. 

Cultural Orientation

The findings, based on data from Chinese university students, revealed that cultural orientations significantly predicted attitudes toward compliance and psychological responses.

The study found a high overall endorsement of restrictive measures. 

Compared to Japanese and American counterparts, Chinese participants exhibited the highest acceptance of society-level preventive measures. 

This strong compliance with social distancing can be attributed to the strict isolation measures implemented by the Chinese government. 

However, despite behavioral compliance, participants might have had personal reservations about individual-level precautions, such as wearing gloves when shopping or disclosing travel history.

Predictors of Compliance

Several predictors shed light on Chinese participants’ attitudes toward compliance. 

Gender was one such predictor, with female students demonstrating a greater willingness to comply than males.

Additionally, cultural orientations at the individual level played a significant role. 

Vertical collectivism (VC) predicted positive attitudes towards compliance, as it fostered a strong group identity and respect for authority. 

Horizontal collectivism (HC), while promoting in-group commitment, did not lead to the same level of acceptance of preventive measures. 

Individualistic orientations had mixed effects, with horizontal individualism (HI) positively predicting compliance and vertical individualism (VI) predicting less favorable attitudes toward compliance.

Contrary to previous research on epidemics, the study found that concerns about the virus did not notably predict positive attitudes toward compliance. 

Instead, psychological distress was positively predicted by VI and VC, indicating that those who valued uniqueness and competition or strong group identity experienced more negative psychological effects. 

In contrast, HC predicted less psychological distress, suggesting that individuals emphasizing equal responsibility within their in-group experienced fewer mental health problems.

Chinese college students were more willing to comply with preventive measures if they had higher VC and HI cultural orientations.

Trust

While trust was linked to attitudes towards compliance and psychological distress, it did not notably predict these variables in the regression models. 

This indicates that individual-level cultural orientations were more influential in explaining compliance attitudes and psychological responses than interpersonal trust.

The study highlighted the importance of considering psychological distress and cultural orientations in public health interventions to promote public cooperation. 

By incorporating individuals’ beliefs and concerns, effective strategies can be developed to fight infectious diseases without compromising democratic values.

Assertive vs. Avoidance Tactics: How Does Culture Determine Approach to Conflict Resolution?

Posted on by Leave a comment

How do you approach conflict resolution?

Are you tactically assertive or avoidant?

And is your approach determined by personality or culture?

Over the coming weeks, I’ll discuss scientific studies dealing with the six cultural constructs, the first of which is individualism versus collectivism.

This paper by cognitive and cross-cultural psychologist, C. Dominik Guess, takes a look at conflict resolution in individualist and collectivist cultures.

Japan Collectivism vs. US Individualism

One of the studies in Guess’ paper explores how cultural background shapes the way conflict is handled – specifically, American individualism versus Japanese collectivism.

A group of researchers, led by Ohbuchi, Fukushima, and Tedeschi, gathered American and Japanese students and unleashed the power of conflict recall. 

They asked participants to dig deep into their memories and recall a conflict they had experienced.

These participants were then asked to share their conflict experience – what they did, what they wanted to achieve, etc. 

Using rating scales, they were asked to measure various aspects of the conflict, like goals and tactics. 

In the battlefield of conflict, four major tactics emerged, each with its own arsenal of sub-tactics: conciliation, assertion, third-party intervention, and avoidance.

The Four Tactics

Let’s better understand the four tactics identified.

Conciliation – this tactic involves finding common ground. It’s a way to indirectly communicate expectations and build bridges. 

Assertion – this tactic is a bold and assertive move, where you fiercely demand what you want.

Third-party intervention – this tactic involves calling in reinforcements in the form of seeking help or advice from an outsider. 

Avoidance – this tactic is the ultimate passivity, dodging confrontation like a pro.

Considering these differing approaches to conflict resolution, you can imagine the cultural clash that may result.

The Results: Assertive vs. Avoidant

As you may have guessed, the American students, with their individualistic spirit, generally used assertive tactics in their conflicts. 

On the flip side, the Japanese students, being the collectivist champions they are, took a more subtle approach overall. 

They opted for avoidance tactics, sidestepping confrontation and prioritizing harmony in their relationships.

This may be because each group’s main goal in these conflicts also differed.

The Japanese participants prioritized their relationships, while the American participants’ goal was more often geared toward achieving a sense of justice.

While the results confirm what most would have hypothesized, considering what we already know about individualist and collectivist cultures, the research could be adapted so that the type of conflict being discussed is more uniform. 

An individual’s approach (the tactics and goals) may vary based on the conflict.

As the students were allowed to choose whichever conflict they wanted to assess, their responses may have differed based upon the type they chose.

Regardless, this study may tell us something key about how individualists and collectivists approach conflict: individualists with justice in mind, and collectivists with harmony.

Do You Know Yourself? Individualist vs. Collectivist Self Insight

Posted on by Leave a comment

How do you see yourself?

Can you accurately self-reflect on your traits, behaviors, and ideology and use that knowledge to predict how you might behave in the future?

Do you see yourself clearly? Do you understand why you do the things you do?

And how does your culture influence that self-insight?

Over the next several weeks, we will dive headfirst into the six cultural constructs discussed in last week’s post, the first of which is individualism versus collectivism.

Individualism vs. Collectivism

Individualists and collectivists often have different motivations. 

Why?

Because the societies and cultures that form these us provide us with different values, norms, dreams, desires, etc.

Individualist cultures generally prioritize personal achievement and independence.

Collectivist cultures, on the other hand, prioritize cooperation and group harmony.

These diverging priorities lead to diverging motivations.

And, according to the following study, a differing degree of self-insight.

Self-Knowledge & Culture

Published in the Journal of Personality and Social Psychology, this study by Balcetis, Dunning, and Miller examines how cultural differences influence people’s ability to predict their own behavior in situations with moral or altruistic overtones. 

The researchers found that collectivists were more accurate in their self-predictions compared to individualists. 

In three different studies, individualists overestimated their likelihood to act generously in situations involving redistributing rewards, donating money, or avoiding rude behavior, while collectivists were generally more accurate in their self-predictions. 

Both groups predicted peer behavior with similar accuracy, but even when samples were taken from the same cultural group, collectivists still demonstrated more precise self-predictions than individualists. 

This suggests that the accuracy of social insight and self-insight can be biased by culturally bound motivations.

Results, Discussed

Why do individualists have a harder time predicting their own behavior? 

One theory is that they focus on themselves too much and assume their behavior will be consistent with their personal traits, leading to inaccurate predictions. 

Individualists who are motivated to emphasize personal uniqueness tend to strive to be better than the group, and thus the best strategy for self-prediction is an internal one based on one’s dispositional nature. 

On the other hand, collectivists who prioritize fitting in with the group may be better at predicting their own behavior because they consider external factors and group behavior.

Collectivists are not motivated to emphasize personal uniqueness and instead strive to fit in with a comparison group, so the best approach to take when making predictions about the self is an external one based on distributional, group-level base rates.

Factors such as face-saving may also moderate these patterns of accuracy. 

This highlights how understanding what constitutes normative social behavior can inform personal self-understanding, but cultural differences may prevent people from knowing themselves precisely because they strive to be different from the norm or typical group member.

Does Individualism Corrode Social Capital? Find Out Here

Posted on by Leave a comment

Would you require more social capital and cultural capital to succeed in an individualist country? Or less?

Do you think the individualist system or the collectivist system is more conducive to social cohesion?

There is a debate among theorists about whether individualism poses a threat to a society’s cohesion and communal association or whether it aids the development of social solidarity and cooperation. 

Some argue that the growth of individuality, autonomy, and self-sufficiency is essential for a healthy society, while others argue that excessive individualism undermines social ties and leads to a breakdown of community.

This study by Anu Realo and Jüri Allik suggests the opposite is true. 

Let’s take a look.

Individualism-Collectivism & Social Capital

Social capital and individualism-collectivism (IC) are two important constructs that have been studied extensively in the social sciences. 

As we outlined in a previous post, social capital refers to the networks, norms, and trust that facilitate coordination and cooperation among individuals and groups.

We’ve also extensively discussed IC – the degree to which people prioritize their own goals and interests versus those of the group.

Despite the seemingly contradictory nature of individualism and social ties, research on the relationship between social capital and IC suggests that there is a positive association between the two constructs. 

Individualism & Trust

Countries with higher levels of social capital are more individualistic, which suggests that independence and freedom to pursue one’s personal goals are of value to social capital. 

This is because social capital is based on trust, and trust is more likely to form in societies that value individual autonomy and self-determination.

Those societies in which trust is limited to only nuclear family or kinship have lower levels of social capital. 

Social capital is not evenly distributed within societies and can vary depending on the size of social networks and the degree of trust within them.

Social Capital Not at Odds with Individualism

To put it simply, social capital and individualism are not necessarily at odds. 

Instead, promoting social capital through policies that strengthen relationships and trust – such as investments in education, infrastructure, and community development – can help to build stronger communities, even in societies that value individual autonomy.

Is It Worth the Risk?: Different Cultural Takes on Risk Perception

Posted on by Leave a comment

Are some cultures greater risk-takers than others?

This study dove in to find out.

Analyzing the data of respondents from Germany, Poland, the US, and China, the study measured respondents’ risk preference for pricing financial options.

These are their findings.

Hypothesis

Studies have shown a correlation between a culture’s position on the individualism-collectivism scale and its risk preference.

Called the Cushion Hypothesis (Weber & Hsee, 1998), the theory suggests that those from collectivist cultures are more likely to take financial risks.

Why?

Due to the perceived support from their collectivist culture and, thus, the reduced negative consequences such a risk might have on the individual.

While this study did arrive at the same conclusion – that the collectivist society of China was less risk-averse than its American counterpart – it did identify a more specific reason for it.

Risk-Averse

The majority of respondents in all four cultures were identified as risk-averse (i.e. they were willing to pay more for options they saw as “less risky”).

When you look at a risk-return conceptualization, it is natural that most people, no matter what culture, would perceive risk this way.

When risk preference was evaluated in the traditional expected-utility framework, Chinese respondents were considerably less risk-averse in pricing than Americans.

But what this study found was that the difference in risk preference may not be due to a cultural attitude toward perceived risk; instead, it appears largely due to the perception of the financial options’ risk itself.

Chinese participants simply did not find the options as risky as their counterparts.

Conclusion

The study states:

“Chinese respondents were closest to risk neutrality in their pricing of the financial options and judged the risk of these options to be the lowest, but were not significantly less perceived-risk averse.

“American and Germans offered the lowest prices and also perceived the risk of the options to be highest, but were not significantly more perceived-risk averse.”

One might practically apply this knowledge to commerce and negotiation when working across these particular cultures, affording both negotiators joint gains.

The study concludes that while cultures do vary on a collectivism-individualism continuum which undoubtedly impacts perceived risk, other cultural factors in risky decision-making – locus of control, differences in achievement motivation, etc. – may also come into play in risk preference.

Further studies into the subject might provide more insight.

Ethnocentricity: When Subjective Bias Enters Cross-Cultural Research

Posted on by Leave a comment

Culture has a four-corner foundation.

To recap, the four main building blocks are:

These four categories, in particular, will not only aid your understanding of cross-cultural differences, but they’ll allow you to adapt your managerial methods when leading across cultures.

Below is an overview of these four building blocks.

monkey_charts_CMYK

 

As you can see, countries are scattered across the scale from left to right, accordingly. But one of these countries remains in place.

The United States.

The US always appears on the far left of the scale.

Why?

Because of ethnocentricity.

What is Ethnocentricity?

Ethnocentricity involves judging other cultures based on the values of your own.

Even great researchers, like Geert Hofstede, haven’t managed to design a purely objective framework in their studies on cross-cultural differences.

Their own cultural heritage inevitably appears in their research via charts like this one and through constant comparisons (and often biases) between their own culture and “the other.”

Simply put, the values and standards we find most important to our own culture are often what we deem worthy of study and comparison.

Religion, norms, language, customs, ideology – these are the attributes we compare in order to understand cultural identity. And, whether or not the intention for bias is there, those conducting the study determine their culture to be “right” and the other to be “wrong.”

Although ethnocentrism may sound wholly negative, it is psychologically innate.

The US vs. China

Let’s look at an example.

When cross-cultural research is done from an American viewpoint, individualism is often a highly valued criterion.

Moreover, the future-oriented, rule-oriented, and self-determined United States swing their bias of time valuation, personal vs. societal responsibility, and locus of control in the relative directions.

These “typically American” values force the U.S. to the far end of a spectrum of the four building blocks of culture, as these are important values to Americans and are highly considered when categorizing cross-cultural research.

If, say, China was conducting the same research, their spectrum – and where they landed on the spectrum – would undoubtedly differ.

China would evaluate other cultures according to their own valued criteria.

These criteria would likely have roots in collectivist, rather than individualist ideology. The way other cultures relate to their own values would form the subjective and ethnocentrist results that cross-cultural research often takes on.

Next week, we’ll delve more deeply into ethnocentrism and discuss how it directly manifests in cross-cultural research.

Does Individualism Drive Economic Development?

Posted on by Leave a comment

It’s the age-old question: do individualist cultures see more economic success than collectivist cultures (e.g. capitalism vs. socialism)?

We’ve mentioned how individualism vs. collectivism is one of the most important (if not the most important) of Hofstede’s cultural dimensions. The degree to which a culture lies along this scale can determine much of the culture’s values and norms.

The West (the US and European countries, in particular) believes that economic development is fueled by individualism.

Is that the case?

The “Spirit of Capitalism”

Adam Smith, the author of The Wealth of Nations (considered “the Bible of capitalism”), wrote that the economic model of the West is rooted in the individual’s aspirations and initiative to earn money, build his career, and elevate his social standing.

He writes:

“The real tragedy of the poor is the poverty of their aspirations. It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest. Man is an animal that makes bargains: no other animal does this – no dog exchanges bones with another.”

And he wasn’t the only economist to believe so. Economist Max Weber coined the phrase the “spirit of capitalism,” which embodied the entrepreneurial spirit of the West, the desire to climb the social ladder and build a career, all of which was once believed by some to be the sole method of driving economic success.

However, as we discussed in a previous post, Japan disproved this theory by demonstrating that a collectivist culture, with its own values and norms, can boom economically as well.

Apart from the “Japanese Miracle,” business models like Kaizen’s steps to improvement and the quality circle provide positive outcomes and follow collectivist values.

The Lexus

An example of collectivist culture contributing to economic success:

I was invited to a presentation of the Lexus, a luxury Japanese car brand. The production process involved a unique manufacturing method put in place to guarantee top quality.

The car bodies were mounted in a large hall and transported along an assembly line of steps, in which each worker had his/her own task, like welding or screwing parts to the vehicle. A string hung from the ceiling at each step, allowing workers to stop the entire assembly line production if necessary.

Of course, pulling that string costs the company a fortune. But not doing so, if there is a quality issue, could cost them even more…and might even ding their reputation if left unchecked.

So, despite the costliness of pulling that string, when an assembly worker makes that decision, he’s greeted with cheers.

Why?

Because he took a bullet for the team, stepped up and disrupted the workflow, hopefully with reason. Nevertheless, the worker isn’t punished for putting quality over cost, which is why Lexus has a reputation for reliability.

In this way and many more, Japan has demonstrated that an individualist culture is not required for economic development. Both collectivist and individualist cultures have their strengths.

Next week, we’ll talk about the driving factor behind economic success in either type of culture.