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@Hofstede Insights
Welcome to
Hofstede InsightsThe key to Culture
Innovation and SMEsBy Egbert SchramHofstede InsightsFor CUBE IN
@Hofstede Insights
M.Sc. In Forestry (Wageningen University) and ongoing PhD in Social Psychology
(Helsinki University)
Chairman of International HR chapter, Finnish HR Federation.
Member of advisory board, Amcham Finland
Areas of expertise: internationalization, SME´s, culture, international account
management, HRD and business development.
Dutchman, living in Finland, married to Finnish wife, 2 kids.
Group CEO Hofstede Insights
Egbert Schram
@EgbertSchram
@Hofstede Insights
IN THE ABSENCE OF KNOWLEDGE…
Culture is the buzz-word
Business strategy has changed, are we ready to implement it?
Acquisition or mergers: Where and how to integrate
Sales is down, we don‘t know why
Employees are running away, no clear reason
We are not as productive as we should be
Big disparity in our different country operations
New leaders don‘t last very long
Issues with „culture fit“ –how to make diversity work
Unclarity on our identity- what defines us really?
WE NEED TO BE INNOVATIVE
@Hofstede Insights
About UsWHAT WE DO
Manage the impact of culture
on work-life by aligning culture
and strategy using a tangible,
data-driven approach.
https://www.hofstede-
insights.com
#theculturefactor
@HofstedeInsight
OUR BACKGROUND
Founded on Hofstede´s academic
knowledge in 1985. Merged with a
Finnish Human Capital Analytics
company in 2012. Combining
predictive technology and human
behaviour.
WHO WE ARE
A global organisation of over
150 associate partners in 60+
countries, headquartered in
Helsinki
@Hofstede Insights
ABOUT US
WE PROVIDE SERVICES TO OVER 5,000 ORGANISATIONS
FINANCIALSERVICES
MARKETING & CONSUMER GOODS
GOVERNMENT & SUPRANATIONAL
MANUFACTURING & INDUSTRY
TELECOMMUNICATIONS& IT
HEALTHCARE
@Hofstede Insights
www.cubein.eu
CUBE IN PLATFORM
About the CUBE IN platformIt was designed to help European SMEs with business and innovation in emerging markets.
CUBE IN was set up by a consortium of experts in the fields of cultural differences with involvment of SME support and innovation agencies.The Cube In platform is owned by the European Commission through the Executive Agency for SMEs. The project is coordinated by Hofstede Insights in cooperation with SPI.
CUBE IN provides• Self-assessment tools to test your readiness,• An online library to help you learn more about the culture and customs of your target country,• The possibility to attend webinar sessions with experts.
@Hofstede Insights
INNOVATION
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INNOVATION
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SME´s
MICRO
<10 employees, <2mln
euros turnover or <2 mln
euro balance sheet
MEDIUM
<250 employees, <50 mln
turnover or <43 mln
balance sheet
SMALL
<50 employees, <10mln
euro turnover or <10mln
euro balance sheet
HUGE IMPACT90-99% of economy
60-70% OECD job creation
67% of EU GDP
@Hofstede Insights
9.8 million SME´s in Europe
30 million SME´s in emerging economies
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@Hofstede Insights
Innovation barriers for SME´s
Capital“ Culture
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What is Culture?
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What do you see?
@Hofstede Insights
The collective programming of
the mind with which one group
distinguishes itself from anotherProf. Dr. Geert Hofstede
“ “
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Or
”the way we do things around here”
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Innovation is about going the other way
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Reverse innovation and impact on mature markets
Source: Govindarajan, V., Ramamurti, R. (2011),
Lower income levels – matching needs;
Cost reductions lead to demand increase
New properties = new market segments
‘Good enough’ products developed in emerging markets improve over time until they meet the requirements of mature markets;
New technologies, free from ‘legacy technologies’ and laws or regulations.
@Hofstede Insights
UNDERSTANDING YOURSELF
1. How culture influences you personally2. How culture affects your organisational
way of working
UNDERSTANDING YOUR TARGET MARKET
1. Understand how your target market works and how
it impacts your business
CHANGING YOUR SELF
1. Your personal communication2. Your organisational way of working
Where does this lead us?
@Hofstede Insights
The way in which members of an organization relate to each other, their work and the outside world
in comparison to other organizations
Prof. Dr. Geert Hofstede
20
@Hofstede Insights
Perceived Culture
"The way we think we are"
Actual Culture
"The way we actually are"
Desired Culture
"The way we like it to be"
Optimal Culture
"The way we need to be in order to
succeed"
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Your culture helps you to achieve your strategic goals
Organisational culture is not about good or bad
It is about being functional
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Impact of nationalities POWER DISTANCE
Relationship to power
INDIVIDUALISM/COLLECTIVISM
Relationship to the group
MASCULINITY / FEMININITY
Relationship to motivation
UNCERTAINTY AVOIDANCE
Relationship to uncertainty
LONG TERM ORIENTATION
Relationship to time
INDULGENCE-RESTRAINT
Relationship to pleasure
The importance of understanding “what we do” in organisations is partially guided by “how we feel” about that what we do.
23
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Multi-Focus Model™ ofOrganisationalCulture
EFECTIVENESS
Means vs. goal oriented
Focus on how we work
vs what we do
FOCUS/SOCIAL CONTROL
Local vs. professional
Focus on where people put their
loyalty, on individuals or their
profession. CUSTOMER ORIENTATION
Internally vs. externally driven
Focus on where we get our work
impulses come from – internal or
external.
APPROACHABILITY
Open vs. closed system
Focus on how easy it is to acquire
necessary information.
CONTROL
Easy-going vs. tight work control
Focus on how we go about
ensuring discipline
MANAGEMENT PHILOSOPHY
Employee vs. work oriented
Focus on whether we believe
people will work hard intrinsically
or whether we need to push them
to work hard.
D1
D2
D3
D4
D5
D6
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Means-oriented Goal-oriented
• A focus on short-term bonuses• One doesn’t do what one promises
to do• Corruption among managers and
professionals next to rank and file people who misappropriate assets
• Harmful internal competition• Each one’s own kingdom• Self-aggrandizement among top
managers due to successes in the past
A. Dysfunctional means-oriented
0-350 50 100
• Many rules and regulations• Repetitive work• As few surprises as possible• We don’t want to run any
risks• Continuous monitoring• Preventive maintenance
B. Functional Means-oriented
35-45 45-55
C. In-between
• Many rules and regulations• Repetitive work• As few surprises as possible• We don’t want to run risks
55-100
• Entrepreneurial• Working smart• Creative• Productive• Trustworthy• Inspirational leadership• Every day offers new challenges
D. Goal-oriented
D1 Organizational Effectiveness
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Case Study
• Company A works in the medical product sector. It is extremely efficient. It is heavily impacted by regulations. Products can not have any errors.
• The organisation faces problems with the speed of innovation, especially from small medical start-ups. The new strategy calls for agile and lean thinking.
• What should be its optimal culture (0-100)?
• Group A: Management team
• Group B: R&D team
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@Hofstede Insights
TO INNOVATE = TO UNDERSTAND YOUR CONTEXT AND THEN LEVERAGE IT
• 1st law: Knowledge multiplies when it is shared.
• 2nd law: Value is created when knowledge moves from the point of origin to the point of highest need or opportunity.
• 3rd law: Collaboration for mutual leverage provides optimal utilization of tangible and intangible resources within and across boundaries.
• Cultural Insights provide you with better contextual understanding
@Hofstede Insights
Where does this leave larger organisations?
• Understand how your way of working might impact your innovation capability.
• Understand which SME´s are relevant to you and how their way of working impacts their ability to work with you.
• Agree on joint working practices (Optimize culture fit)
• Provide Capital
@Hofstede Insights
“
For more information: Egbert [email protected]
+358 451375007
www.hofstede-insights.com
www.cubein.eu
You can find the recording of this web session here: :
https://www.cubein.eu/content/influence-cultures-
innovation-management-capacities-smes-0innovation-management-capacities-smes-0
