Cultural and Business Differences Between Spain and America

Cultural Dimensions between United States and Spain

Cultural dimension is an essential perspective of leadership that can ensure the success of an organization. A manager is supposed to adapt to any organization irrespective of changes that a new organization can offer. A manager who is flexible and quick will always be successful regardless of the part of the world where he/she works.

This paper will look at different cultural dimensions between United States and Spain. Power balance in America scores lower than that of Spain. Most Americans accept uncertainty compared to Spaniards who are uncertainty avoiders. Norms of conducting business in America and Spain are very different, and compromise will be essential in succeeding as a manager in Spain.

The study has further compared the gender egalitarianism, group collectivism and future orientation, which form the key cultural dimensions that influence the leadership style to be embraced especially at the international arena. American management culture is significantly different from Spanish one in different aspect. The cultural dimensions outlining the differences have been explained in detail in order to provide an essential tool to a corporation intending to venture in Spanish market. Understanding the differences in management culture used in USA and Spain has been underscored as a core instrument of launching successful investment in Spain. Furthermore, expectations of the potential country of investment will be essential in shaping the leadership strategies to be adopted in the new business environment.

Power Distance

Power distance is an extent to which the less powerful members of a firm, institution or organization within any given country acknowledge that the distribution of power is unequal. The dimension is concerned with the way in which a culture is stratified, and thus creates levels between people based on authority, power, wealth, prestige and material possessions. Inequality of power within organizations is inevitable (Hofstede & Minkov). Learning more about power distance will be essential. It will be important to understand the differences between power distance in America and Spain. Countries will score differently on this dimension. A country can have either large or small in power distance index. A culture with a small power distance index emphasizes that inequalities among people should be minimized and that there should be interdependence between less powerful and more powerful people. In terms of power distance, the United States scores low on this dimension. It is estimated to be at around 40. Many decisions in an organization are reached democratically. This is mostly done for convenience where people occupying managerial or powerful roles in an organization change regularly. In America, workers are expected to try to climb the ladder of success so as to move and occupy or hold these prestigious positions. Organizations in America encourage people to work hard and the latter are motivated to reach the managerial positions. Managers in America motivate their workers in a more participative method and appeal to them to act on their behalf. Employees are a crucial part in decision making and share goal setting activities (Hofstede & Minkov).

In contrast, the power distance index of Spain is relatively higher. It has a score of approximately 57, and this reflects a hierarchical distance in an organization. Hierarchical distance or power distance is accepted in Spain and people holding managerial or senior positions in an organization are allowed to have privileges for their positions. Employees working under these managers expect their boss to control them, and they remain to be subordinates. Failure to have an interest towards a junior staff in Spain would mean such a staff is not relevant to the organization (Madaock). This will leave such an employee much unmotivated. In Spain, power in an organization is centralized and workers and bosses are treated unequally. In large power distance culture, many workers in an organization are not educated to the level of their superiors. This makes managers in Spain be treated or entitled to special status and privileges. The larger power distance in Spain ensures that there are layers and the chains of command are essential in the management (Waldman & Konrad). To discharge managerial roles in Spain effectively, adapting to the hierarchical structure of management will be essential. It will be advisable not to rely on subordinates in any aspect of management unless when there is a voluntary contribution. These implications of larger power distance in Spain will mean one will have to follow directives, policies and rules set by higher levels of management without questioning.

Uncertainty Avoidance

This dimension denotes the extent to which a society, group or an organization relies on established rituals, social norms and procedure to avoid uncertainty. This dimension is concerned with the manner in which cultures use structures, laws and rules to make things less uncertain or more predictable. Uncertainty avoidance deals with or looks at what people do to control their future. This dimension or ambiguity brings anxiety and both Americans and Spanish people have ways of dealing with it. Using an Uncertainty Avoidance Index (UAI), America has a score of 46 (Waldman & Konrad). America can thus be described as an uncertainty accepting country. In an organizational context, there is a large degree of acceptance of new ideas, willingness to try new ways of doing things and innovative products (Madaock). A lower score in America means that being a manager, one expects employees to be tolerant to ideas, opinions, and this promotes freedom of expression. In addition, this means that many employees do not require many rules and they are less emotional.

In contrast to the uncertainty accepting Americans, people from Spain are known for their high rank of uncertainty avoidance. Uncertainty avoidance is what some researchers have used to define Spain. Spain is considered the noisiest country in the world. People are always in need of more and more rules. Changes in Spain are known to cause stress to many people. However, many people in Spain are obliged to avoid laws and rules (Madaock). This will make life in Spain a manager complex. Many people in Spain avoid confrontation at all costs so as to avoid stress which scales up to personal levels very quickly. In Spain, there is a big concern for ambiguous, changing and undefined situations. For example, in a recent study, 75 % of Spanish young people reported that they would like to work in the civil service whereas in America only 17 % of young people preferred to work in the civil service (Hofstede & Minkov). This shows that many Spanish people are more concerned about their future, and this makes them prefer a job for life in the civil service. This implication of avoidance of uncertainty in Spain will mean that I will be working with very passive employee. Employees who will not confront me with new ways or methods of doing things and this will mean decision making will be a role of the manager. Additionally, new challenges or methods of doing things will not be readily available as employees will most likely want to do things in the olden ways. However, as a manager after the success of the organization, I will try and involve or allow an employee to develop an understanding of all initiatives (Hofstede & Minkov). I will be prepared for a more fatalistic world view where employees will possibly be less willing to make decisions with an element of the unknown. The difference between American and Spanish uncertainty avoidance scores will mean that I will expect much reduced input from the employees. This will mean decision making will be solely a role of the manager (Madaock).

Gender Egalitarianism

In this context, masculinity and femininity dimensions indicate the level of gender equity in a society. A high level of masculinity implies that a society is driven by competition, success and achievement defined by the best in the field. This has been found to be the dominant in the USA; it starts right from the school and progresses at the workplace (Northouse, 2009). In the USA, the society is considered to be masculine, and the behavior is usually based on the shared values that people need to work in order to strive to be exemplary. As a consequence, American managers will always tend to display and speak about their exemplary performance and achievement in life. Furthermore, this has been used to form a basis for decision making regarding hiring and promotion process in the workplace. In essence, Americans live to work in order to gain more monetary reward and to attain higher social status. However, this does not result to gender discrimination since the desire to succeed makes both genders strive to compete with each other (Northouse, 2009). As a result, this makes gender discrimination in the workplace nearly non-existent since competition exists with all people in the society and not essentially member of the opposite gender.

In contrary, there are gender gaps in Spanish organizational management structures. Corporate strategy normally sets the framework for doing business and for determining the internal work culture (Konrad). The gender equity in an organization is usually established when the company rationale with regard to gender equity is established. The concept of gender equality has to be an integral part of the overall corporate strategy. This has been essential in successfully addressing the gender pay gap within the company. Therefore, as an American manager with large exposure to American management style, prior understanding of the gender structures in Spain will be critical to determining the leadership style to be employed. The manager will need to endorse the company`s strategy towards gender equality in order to establish sustainable principles of equality between men and women in the company. Unlike the natural gender equity environment that exists in the USA, the management in a Spanish company is usually responsible for implementation of the corporate strategy incorporating gender equity. Furthermore, the company managers normally act as the role model and multipliers within and outside the company (García, 2005).

In-Group Collectivism

American management culture has been considered to put less emphasis on group collectivism. In return, the organizational culture has been considered to be highly individualistic. According to Hofstede’s study, the United States ranked first with a score of 91 out of 100 on individualism scale. This has been attributed to the American tendency to be driven by the strong work ethic (Hofstede & Minkov). American managers also tend to highlight individual achievements as well as a strong and firm individual goal orientation. The individual liberty and rights are also deeply embedded in the American society over time. In addition, individualism has also been enhanced by democratic and property laws. However, as a result of an increased influx of immigrants with collectivistic attitudes, norms and behaviors, current studies have indicated that American culture is gradually becoming more collectivistic. Nonetheless, the changes have yet to be experienced in the corporate world where individualism remains dormant (Hofstede & Minkov).

In contrast, Spanish managers portray low levels of group collectivism. Spanish managers are also individualistic and work poorly in groups. It has been found that Spaniards show collectivism when it comes to family and not during work in an organization. This has essentially explained why teamwork and participation have not been successful in Spanish companies. The low level of institutional collectivism explained the compensation practices adopted by them. Most Spanish organizations are increasing their use of variable pay at the individual level. As an American manager intending to venture in the region, it essential to understand the difference in level of collectivism in order to shape leadership in a way that would allow to meet the expectation of the workforce in the host country. The level of collectivism in Spain is considerably low in comparison to the American culture. This has been found to influence the payment structure in the country. As a result, the manager needs to understand that Spanish companies are less likely to introduce group and organizational payment schemes. It is also to understand that union membership in the country is extremely low meaning that level of collectivism and teamwork is low. As a result, organizational responsibility needs to be assigned to individual capacity rather than teamwork in order to enhance organizational efficiency.

Future Orientation

Spanish HR practices portray low levels of future orientation. This has been referred to as improvisation style of Spanish managers. Study involving managers who have worked in both Spanish and foreign multinational companies revealed that Spanish managers tend to be passionate, non-methodological and intuitive. The managers often tend to reject planning in favor of spontaneous actions, thus describing them as impatient and having a short-time perspective (García, 2005). This has been attributed to lack of future orientation. The most common aspect in most Spanish organizations is lack of formal programs in favor of informal and inflexible work arrangement. It has also been found that organizations lack a formal job description and communication plans as well as formal methods of recruitment, selection, training and career promotion. This has been attributed to preference among Spaniards for naturalness and improvisation resulting from low levels of future orientation (García, 2005).

In contrast, the extent to which an organization shows pragmatic future-orientated perspective rather than short-term point of view is considerably low in American controlled corporations, but higher than in Spanish corporations. The United States of America scores low in this dimension because its organization is short term orientated. As a consequence, the American culture focuses on the traditions and achievement of the social obligations. With regard to this perspective, American controlled and owned corporations tend to measures their performance in a short term basis, with profit gain and loss statements being presented on a quarterly basis. This has been found to drive employees into striving to achieve quick result in the workplace. However, American channels of communication, hiring, selection, and training are essentially formal.

As a foreign manager, it is essential to understand that the low level of future orientation, common in Spanish companies, stems from the adoption of improvisational styles of management preferred by the Spaniards. In shaping the leadership style to be employed in a host country, a manager needs to acknowledge that low future orientation in America is normally attributed to capital market demands (García). In most cases, American shareholders are usually interested in quarterly earnings reports. In contrast, Spanish low future orientation is shaped by the lack of formal structures and overemphasis on improvisational styles. Furthermore, it is essential to understand that though high degree of time is allocated to training in Spain, the training normally tends to be more reactive in nature rather than being formal and planned.

Business Norms in Spain

Decision Making Takes Time

Decision making is a significant leadership skill that is essential in any management role. However, while conducting business in Spain, one should not expect a decision to be made quickly. This is especially if it means that a person or company you are dealing with will have to alter or change something significant (Madaock). In Spain, reaching a decision will involve several meetings. This can be explained by the hierarchical structure in Spanish culture. Most decisions in an organization can only be made by the top management. Slow decision making will have implication on my leadership style. In America, I had been used to a charismatic, democratic or participative leadership. This had always ensured timely and quick decision making. However, decision making will be slow and this will negatively affect decision making (Madaock). However, being patient will ensure that the correct decisions are made although over a longer time.

Spanish Business Meetings

Unlike in America where a business meeting can start as early as 7am, in Spain, this is not the case. The Spaniards enjoy taking their time in the morning enjoying breakfast with family members and not with business contacts. Instead, most business meetings will either happen over lunch or dinner. A meeting starting at the office can easily progress into a long leisure lunch or dinner. This norm of conducting business in Spain will affect my pace-setting leadership style. In America, I am used to executing tasks fast and with high quality. It will imply that in Spain, holding or calling for a crisis meeting that immediate attendance is paramount may not work out well with the Spaniards. Additionally, business offices are close from 2 pm to 5 pm for siesta (Madaock).

Corporate Culture

The Spaniards are known for lack of punctuality for any business meeting. They do not take meetings seriously, but if one intends to be late, one must call and give an explanation. The Spaniards do not possess a meeting culture and the first meeting can only be meant for familiarization. This will negatively affect my democratic leadership styles. This is because lack of punctuality cannot work well with a democratic leadership style. More stringent leadership styles such as an aristocratic one will be employed (Madaock).

• Communication

The Spaniards can be described as outgoing and cheerful people. They are known for their initial friendliness and face to face discussions are essential. One is expected to present him or herself in the best possible way. This will affect my leadership style where I do not expect to be humorous to my juniors.

• Team Work

Individualism. Multi-active and hierarchical Spaniards find it hard to work in teams. Employees or business people are used to receive directives from seniors, and this will affect my democratic leadership style. This will mean that participation of junior managers in a business meeting will be very minimal.

• Expectations

Spanish people normally hold various expectations from their corporate leaders. The same case applies to American controlled corporations. However, people`s expectation are usually varied in two different contexts, mentioned above. In Spain, people`s focus mainly revolves around the achievement of the interest of individuals within corporations. As a result, all efforts are concentrated on flexibility, collaboration and ability to create a favorable environment that nurtures success. Spanish workers normally expect high levels of integrity from their leaders. Employees expect their manager to provide the same level of commitment as the promise provided to the customers (García). Furthermore, the manager is usually expected to establish an environment that nurtures the potential of employees for long term productivity through effective communication of formulated goals. Furthermore, the leaders are often expected to respect and champion the established principles. Although such requirements are universal in different nations, Spanish workers further expect the manager to promote gender equity among the employees in order to ensure that both genders are duly represented in all decision making organs.

However, in American context, different expectations are held for the corporate leaders. The leaders are expected to utilize the workforce through the use of established formal structures to generate profit for the shareholders (Northouse). In American context, profit maximization is normally the primary focus under the doctrine of shareholder primacy. As a result, this becomes the manager`s overriding objective, unlike in Spanish context. In Spain, the corporate manager is usually expected to encourage active co-operation between the company’s workers and all key stakeholders in the creation of jobs, wealth and sustainability of sound financial enterprises. The primary focus is usually not profit maximization for the stakeholders, but the formation of favorable environment for employee development and sustainable wealth creation. In order for a foreign manager to become successful in Spain, the central focus has to shift from the profit maximization as the primary goal to building people’s capacity and creating a strong workforce with regard to Spanish culture (García).