Hofstede and Cultural Issues for Multinational Corporation Essay

Hofstede and Cultural Issues for Multinational Corporation - Essay Example India has Power Distance Index (PDI) score of 77 compared to UK’s 35. The high score for India is attributed to the fact that there exist social hierarchies called castes in Indian society and the large economic gap between the different caste levels. Placing it into an organizational perspective, it can be expected that there are wider salary differentials for different levels of position in an Indian organization as compared to a British one. Managers in the UK are more probable to consult their subordinates because they have a greater sense of equality than Indians who expect that their decisions are followed with minimal questions from subordinates. Due to the great importance given to status and privilege, Vodafone should expect certain events occurring among the employees of Hutchison Essar. For example, conflicts may arise such as qualms of a higher caste person placed under the directive of a lower caste manager as pointed out in the study of Communicaid (2004). This may seem trivial to a foreign company such as Vodafone which bases its promotion to performance rather than societal status or ranking of a person. Vodafone could face employees who are unwilling to recognize a lower caste superior and these persons may sabotage the whole operation. On the other side of the coin, they may find it difficult to persuade highly qualified lower caste persons to assume higher positions because of their fear of retribution from the higher castes that the person will be governing.