International Journal of Cross Cultural Management

CCM
International Journal of
Cross Cultural
Management
Article
Organizational practices across

cultures: An exploration in six
cultural contexts
International Journal of
Cross Cultural Management
2014, Vol. 14(1) 105125
The Author(s) 2013
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DOI: 10.1177/1470595813510644
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Ronald Fischer
Victoria University of Wellington, New Zealand
Maria Cristina Ferreira and Eveline Maria Leal Assmar

Universidade Salgado de Oliveira, Brazil
Gulfidan Baris, Gunes Berberoglu and Figen Dalyan

Anadolu University, Turkey
Corbin C Wong
Morgan Stanley & New York University, USA
Arif Hassan
International Islamic University, Malaysia
Katja Hanke
Jacobs University Bremen, Germany
Diana Boer
Goethe University, Germany
Abstract
This study examined organizational practices in a sample of 1239 employees from various organizations in Argentina, Brazil, Malaysia, New Zealand, Turkey, and the United States. Twenty-four
items measuring employee-orientation, formalization, and innovation practices showed a clear factorial structure across all samples, along with good reliabilities. Significant organizational position
differences were found for employee-orientation and innovation practices. Sector differences
were found for formalization and innovation practices. Cultural differences were found for
employee-orientation and innovation practices, which can be explained using macroeconomic indicators, tightnesslooseness, and individualism. Our study demonstrates the importance of
Corresponding author:
Ronald Fischer, Centre for Applied Cross-Cultural Research, Victoria University of Wellington, Wellington, New Zealand.
Email: ronald.fischer@vuw.ac.nz
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106
International Journal of Cross Cultural Management 14(1)
individual, organizational, economic, and cultural level for understanding perceptions of organizational practices across a wider range of societies.
Keywords
Cultural differences, employee orientation, formalization, individualism, innovation, organizational
practices, tightnesslooseness
The study of organizational culture has much potential to be useful for understanding how
organizations function in different cultural environments. A number of authors (Hofstede, 1980;
Lindorff, 2010) have argued that understanding cultural differences is an imperative for business
survival. For example, some studies have shown that Asian organizations tend to be more
paternalistic and are likely to adopt more bureaucratic control methods and more centralized
decision-making processes, while Western organizations tend to be less bureaucratic and more
decentralized in their decision making (Chen, 2001; El Kahal, 2001). However, cross-cultural
studies directed toward the analysis of those practices that characterize the organizational cultures
of different countries (see Hofstede et al., 1990; House et al., 2004; van Muijen et al., 1999) are
still scarce. Particularly worrying is the fact that, to date, only one study (House et al., 2004) has
included Latin American and Asian organizations. These two areas capture more than two-thirds
of the worldwide workforce and the fastest growing economic systems in the world. Therefore, we
have little insights into the perceptions of organizational culture in these two important geographical regions. The aim of the present study, therefore, is to (1) explore how employees in organizations across six different cultural and economic contexts that include Latin American and
Asian countries perceive organizational practices that typify organizational culture and (2) examine how these perceptions covary with personal, organizational, economic, and cultural characteristics. We are the first to comprehensively report and test hypotheses across a number of domains.
Organizational culture and its manifestations

Research examining organizational culture emerged out of a qualitatively oriented anthropological
tradition. In contrast, the closely related concept of organizational climate arose in psychological
and business research to understand team and small group dynamics using quantitative measures
(see Ashkanasy et al., 2010; Denison, 1996; Peterson and Fischer, 2004 for reviews). Definitions of
the two concepts seem to overlap substantively (Verbeke et al., 1998), and there is relatively little
consensus on the conceptual boundaries of the two constructs. Both climate and culture focus on
attitudes, beliefs, values, and behaviors that characterize organizations and teams within organizations and differentiate them from other organizations and teams. More recently, climate work has
returned to focus more on perceptions within teams (Anderson and West, 1998), whereas culture
research continues to focus on perceptions of the larger organization. Therefore, our research
approach fits more with a renewed interest in organizational culture (see Ashkanasy et al., 2000,
2010).
Organizational culture has various components and manifests itself in a number of different
ways. Schein (1992) suggested that organizational culture has three levels: artifacts, values, and
basic assumptions. Rousseau (1990) talks about five organizational culture elements: artifacts,
behavioral patterns, behavioral norms, values, and fundamental assumptions. Despite the number of
elements used for describing culture, most scholars (Deal and Kennedy, 1982; Denison, 1996;
Fischer et al.
107
Hofstede et al., 1990; Rousseau, 1990; Schein, 1992; Trice and Beyer, 1993) consider values and
practices shared by organizational members as the two fundamental elements of the organizational
culture. According to Hofstede et al. (1990), values reflect the organizations priorities, preferences,
or principles, that is, they serve as a criterion for organizational member action (Schein, 1992). They
are the deeper or more invisible aspects of organizational culture (Glisson and James, 2002) and
cannot be directly observed but only inferred from the behavior of the individuals (Hofstede, 1998).
Organizational practices, on the other hand, are the visible side of an organization culture (Glisson
and James, 2002; Hofstede, 1998). They comprise the behaviors, rituals, and ceremonies that
typify the organization, such as weekly or monthly meetings, work group socialization, and the
daily control of e-mail. As such, they reflect the values and beliefs of the organization, that is, they
can be seen as the operationalization of the rules governing the functioning of the organization
(Kostova, 1999).
Organizational practices are greatly influenced by the organizations internal and external
environment (Verbeke, 2000). As a result, they are in a constant state of evolution and can be
changed with relatively more ease than the values that are more difficult to modify. The learning of
organizational practices takes place through socialization processes to teaching new members how
to act and live within that environment (Karahanna et al., 2005).
Hofstede (1997) has contended that values mold the organizations culture but that the members
of the organization are influenced by this culture through adherence to the daily practices. Consequently, the shared perceptions of the organizational practices constitute the essence of an
organizations culture, and organizational practices seem to influence the attitudes and behaviors of
organizational members (Ogaard, 2006; Singh et al., 1996; Tuomi et al., 2004; Verbeke, 2000).
Consequently, they play a fundamental role linking the organizational environment and job individual outcomes (Poole, 1985). Despite their important theoretical role, organizational practices
have received very little attention in the organizational literature (Verbeke, 2000). We believe
therefore that much can be gained by studying organizational culture through the lenses of practices
that typify the organization. Based on these considerations, this article will examine organizational
practices in order to draw distinctions between the cultures of organizations in a variety of national
contexts.
Dimensions of organizational culture

A number of typologies and dimensions have been proposed in the literature for describing organizational culture. Here, we will focus on some research milestones and key instruments. One of the
classical studies of organizational culture conceptualized as values was the Organizational Culture
Profile (OReilly et al., 1991) that included eight empirically identified dimensions in North
American samples. However, applications in other Western societies have resulted in different and
fewer dimensions (e.g. Sarros et al., 2005). Quinn and colleagues (Cameron and Quinn, 1999;
Quinn and Spreitzer, 1991) in their work on organizational effectiveness empirically developed a
two-dimensional organizational culture typology separating (a) flexibility versus stability and (b)
internal versus external focus. These two dimensions lead to four central types of culture: clan
(emphasis on flexibility and internal focus), adhocracy (emphasis on stability and external focus),
hierarchy (emphasis on stability and internal focus), and market (emphasis on stability and external
focus). Rousseau (1990) evaluated seven organizational culture instruments and concluded that its
dimensions could be summarized in three basic categories: task, interpersonal, and individual. Later,
Ashkanasy et al. (2000), in a more comprehensive revision of dimensions of 18 different
108
instruments, settled on 10 empirically identifiable dimensions, comprising leadership, structure,

innovation, job performance, planning, communication, environment, humanistic workplace, individual development, and socialization on entry. In a separate review, Fischer et al. (2005) identified
9 major dimensions or themes in the literature on organizational culture measurement, which partly
overlapped with the empirically derived 10 dimensions by Ashkanasy et al. (2000). Most of these
instruments were focused on values, instead of practices. Furthermore, most of these instruments
and dimensions are developed and applied in Western societies; therefore, the generalizability of
these dimensions to non-Western organizations has not been addressed.
Two notable exceptions testing instruments across a larger number of samples are the European
application of the FOCUS questionnaire (van Muijen et al., 1999) measuring the Competing Values
Framework (Cameron and Quinn, 1999) as well as the Global Leadership and Organizational
Behavior Effectiveness (GLOBE) project (Hanges and Dickson, 2004; House et al., 2004) across 65
societies. GLOBE measures organizational culture using both values and practices at the organizational level that are matched to dimensions of national culture (therefore, it is different in its
conceptualization and ontological nature to most other organizational culture measures).
In short, organizational culture measures are often empirically driven and the original factor
structures often do not replicate (e.g. Ashkanasy et al., 2000; Sarros et al., 2005). It is often unclear
why particular structures were found. Moreover, most of the research has been conducted in Western
settings. Research using Latin American and Asian samples is scarce, despite the growing importance of these regions in the global economy.
In an effort to fill these gaps, we (1) propose a theory-driven approach focusing on the underlying
dimensions of organizational practices; (2) include diverse samples from Latin American, Asian,
and Western countries; and (3) test predictions about covariation of the organizational practice
dimensions with economic and cultural variables.
Exploring universal dimensions of organizational practices

Organizations are open systems (Katz and Kahn, 1978) consisting of separate parts or subsystems
that interact dynamically; they experience different types of conflict between their components
owing to the logical impossibility of all of them attempting to use the same resources or achieve the
same gains. Any open system needs to solve three principal conflicts in order to continue operating,
namely conflicts of interest, conflicts of control, and conflicts of stability versus change (Argote and
McGrath, 1993). These conflicts are characteristic of all open systems, and therefore, we presume
that these conflicts will be evident in all organizations around the world and may provide the
underlying structure for the experience of organizational practices by employees. In the following,
we will briefly describe these three types of conflict and how they may relate to organizational
practices.
The conflicts of interest refer to the incompatibility that exists between the interests of individuals, of the interests of the members of the organization, and the organizations interests taken as
a whole. In this regard, the well-being of the employees usually contrasts starkly with the productivity targets established by work organizations (Argote and McGrath, 1993). This distinction is
reminiscent of Eisenberger et al. (1986) concept of organizational support. This type of conflict
therefore focuses on the degrees of the preoccupation of organizations with the well-being of their
employees versus a primary emphasis on production. This is one of the major dimensions in Fischer
et al.s (2005) taxonomy of culture, which can be found in many cultural inventories (e.g. Ashkanasy
et al., 2000; Detert et al., 2000; Hofstede et al., 1990; House et al., 2004; OReilly et al., 1991).
Fischer et al.
109
Therefore, we propose that a general dimension of employee-orientation practices can be empirically

identified.
The conflicts of control focus on the balance between the necessity for differentiation and
specialization in the subsystems and the necessity of coordination and integration of the functions of
the system; that is to say, the employees need for autonomy and decentralization versus the need for
managerial control and centralization (Argote and McGrath, 1993). This relates to the dimension of
control in Fischer et al.s (2005) taxonomy and is included in a number of organizational culture
inventories (e.g. Ashkanasy et al., 2000; Dellobbe et al., 2002; House et al., 2004). This type of
conflict is also similar to the classic characterization of organizations as mechanistic versus organic
(Burns and Stalker, 1961) depending on the degree of adherence to formal rules and procedures. In
this regard, mechanistic organizations work with clear rules and procedures, that is, performance is
governed by formalized procedures and policies, with more centralized decision making. On the
other hand, in organic organizations, the rules are less rigid and the employees are freer to take their
own decisions. Consequently, our second proposed dimension of formalization practices captures
one important aspect of this larger conflict in open systems.
The final type of conflict proposed by Argote and McGrath (1993) is concerned with the conflict
between stability and change, that is, between the emphasis on maintaining the status quo versus an
emphasis on proactive change and innovation. This type of conflict is particularly important for
many contemporary organizations where new technologies are obliging them to increasingly
embrace new practices and to take advantage of new ideas, products, and processes to maintain a
competitive position in the market (West and Farr, 1990). This dimension is related to innovation
practices in Fischer et al.s (2005) taxonomy and is included in a number of inventories (e.g.
Ashkanasy et al., 2000; Hofstede et al., 1990; OReilly et al., 1991; van Muijen et al., 1999).
Therefore, the third dimension we propose is that of innovation practices.
We therefore predict that perceptions of organizational practices by employees around the world
are structured and organized by these three major types of conflict and can thus be described by
three dimensions, denoted employee-orientation, formalization, and innovation practices. Our work
is both empirically and theoretically driven. Our framework is similar to Wallach (1983), who profiles organizational cultures according to three stereotypical dimensionssupportive, bureaucratic,
and innovative. The three dimensions of organizational practices have been repeatedly identified in
empirical (Ashkanasy et al., 2000) and theoretical (Fischer et al., 2005) reviews of the literature.
These dimensions capture important characteristics of conflicts inherent in open systems (Katz and
Kahn, 1978). Yet, it is plausible that these three broad open system conflicts have additional features
that can affect and shape organizational practices. However, the combination of the empirical and
theoretical work at this stage suggests that these three dimensions probably capture some key components of relevance to organizations around the world. Our first aim is therefore to explore this
underlying proposed structure in a larger pool of organizational practice items.
Exploring differences in organizational practice perceptions

The previous section argued that there may be three underlying conflicts that structure the perceptions of employees regardless of culture, industry, or organizational background. We therefore
argue for a similarity of structure. However, it is likely that the levels of perceptions differ systematically between cultures, industries, sectors, and organizational positions. The second aim of
our study is to explore these differences in more detail.
110
Individual-level variables
First, previous research has primarily focused on managerial employees, with only limited research
on lower level employees. Erez (1994) commented that North American researchers are preoccupied with managers, whereas lower level employees are not often studied. We therefore explore
how managers versus nonmanagers report organizational practices. Previous research on decision
making (e.g. Fischer et al., 2007) has found that managers typically report more favorable views of
the company. This may particularly apply to performance-related aspects of the organization. As we
are measuring two types of practices that are stereotypically seen as conducive to organizational performance (employee orientation and innovation), we predict:
Hypothesis 1: Managers report higher levels of perceptions of organizational practices (i.e.
more frequent use of employee-orientation and innovation practices) than nonmanagers.
Sector and industry effects

Second, sector is likely to have a profound influence on organizational practices. Public organizations tend to differ from private organizations in their goal priorities. Previous research has shown
that public organizations have a more bureaucratic ethos (Kabanoff and Daly, 2000) than that of
private organizations; they tend to be more centralized and formalized, reluctant to initiate change,
and rely more on seniority and stability-enhancing procedures (Fischer, 2008). This reflects the
environmental context with private sector organizations usually functioning in a more competitive
environment than do public sector organizations (Mathur et al., 1996). Employees who work in
the private sector are socialized to be more participative and willing to change and take risks,
whereas those in the public sector are in general more nonparticipative, submissive, and risk aversive (Mathur et al., 1996). We would therefore expect:
Hypothesis 2: Public sector organizations are perceived as being more concerned with
exercising control, more formalized and having less of an innovation orientation (i.e. higher
frequency of adoption of formal practices and lesser frequency of innovation practices).
Furthermore, European research on organizational culture has found relatively large industry
differences compared to cultural differences (Hofstede et al., 1990; van Muijen et al., 1999). In
contrast, Brodbeck et al. (2004) found that cultural effects were significantly and consistently larger
than any industry effects. We therefore explore to what extent industry influences the perceptions of
organizational practices vis--vis cross-cultural differences.
Macroeconomic effects
Third, we explore the effect of macroeconomic variables on organizational practices. The effect of
these contextual variables is an important but relatively an underexplored aspect in cross-cultural
research. The ecocultural framework (Georgas and Berry, 1995), for example, highlights the importance of economic variables on psychological processes. Previous research on organizational justice
(Fischer et al., 2007) has found that economic indicators such as unemployment rates and gross
national income (GNI) have an impact on the use of allocation principles in organizations. In countries with greater unemployment, organizational decision makers were perceived as using less
employee-oriented distribution principles. It appears plausible that in lower income countries
(as defined by the average income reported by the World Bank), organizations focus less on employees and their well-being than the higher income countries. This fits with economic dependency
Fischer et al.
111
theories (Emmanuel, 1972; Martinussen 1997). Employees are somewhat dependent on the income
provided by these organizations and have fewer opportunities to leave (e.g. Fischer et al., 2007;
Fischer and Mansell, 2009). Therefore, we can predict:
Hypothesis 3a: Employee-orientation practices are perceived to be more frequent in highincome countries than in low-income countries (positive effect of income).
A different sociocultural explanation of the link between income and employee orientation is also
plausible. In low-income countries, organizations may not have the financial means for rewarding
individuals at a competitive rate. Economic remuneration is still important but is combined with a
focus on meeting the needs of employees (see Wasti and Oender, 2009). Therefore, organizations
may focus on nonmonetary and social rewards to keep work motivation and morale high. Managers can compensate relatively low levels of income by providing support and taking care of
employees (Spell and Arnold, 2007). Similarly, less economically advanced groups are stereotypically associated with greater interpersonal warmth and positive relations (Cuddy et al., 2009).
Therefore, low-income societies might be likely to be characterized by better interpersonal
relations, social cohesion, and warmth. As a result, we can predict:
Hypothesis 3b: Employee-orientation practices are perceived to be more frequent in lower
income countries than in higher income countries (negative effect of income).
We therefore have two conflicting hypotheses. Organizations from higher income countries may
be associated with greater focus on employee-orientation practices (if the economic dependency
hypothesis is correct, i.e. hypothesis 3a) or it may be associated with lower perceptions of
employee-orientation practices (if the scarce resource compensation hypothesis is correct, i.e.
hypothesis 3b).
For economic growth, hypotheses are more straightforward (Fischer and Mansell, 2009). If
economic growth is higher, more employment is available, and individuals have the option to leave
their organization and seek alternative employment. Organizations also need to ensure that they
retain their staff so they can continue growing faster than their competitors. In these contexts,
organizations need to focus on organizational well-being in order to retain employees. Hence, we
propose:
Hypothesis 4: Employee-orientation practices are perceived to be more frequent in
fast-growing economies than in slowly growing economies.
According to innovation research, the availability of slack resources and expanding markets
are associated with greater innovation levels (Damanpour, 1991). Based on this research, we
propose:
Hypothesis 5: Organizations in economically growing contexts are more likely to engage in
innovation-oriented practices (higher perceived frequency of innovation practices), whereas
in economically stagnant contexts, organizations may be more risk averse and oriented toward
establishing internal control.
National culture effects

Our fourth aim is to investigate the effect of cultural dimensions on perceptions of organizational
practices. To date, there is relatively little research that examines how national culture impacts
112
organizational practices (Fischer et al., 2005; Kirkman et al., 2006). Therefore, we can only propose
some speculative hypotheses for some of the dimensions. Hofstede (1980) proposed four major
dimensions of national culture: individualismcollectivism, power distance, masculinity, and
uncertainty avoidance. Of these, individualismcollectivism, power distance, and uncertainty
avoidance share some conceptual overlap with the issues of interest, control, and stability of open
systems. Furthermore, extending classical anthropological research, Gelfand et al. (2011) recently
introduced tightnesslooseness as another important culture-level dimension along which societies
vary. In the following, we outline how these dimensions are conceptually related to the three major
open system concerns.
Individualismcollectivism is the dimension that has attracted the most attention by researchers
within cross-cultural psychology. It refers to the relationship between individual and group (see
Kirkman et al., 2006, for a review), with structures in collectivistic societies emphasizing group
interests; whereas in individualistic contexts, the individual takes priority. This is closely related
to the interest concern of open systems. In individualistic societies, organizations have to consider
the interests of the individuals working for them, as loyalty mechanisms are based on exchange relationships. As a consequence, employees look out for their personal welfare and leave an organization if they do not perceive further benefits from organizational membership. Organizations need to
maintain high morale among staff. In more collectivistic contexts, these rational considerations are
less prevalent and loyalty is based on normative considerations (Fischer and Mansell, 2009) and less
driven by the interpersonal treatment received in the organization. In line with these theoretical arguments, work on psychological contracts (Rousseau, 1989, 2001) has indicated that organizations in
individualistic societies pay more attention to employee welfare and considerations in order to maintain a highly motivated and productive workforce. Therefore, we predict:
Hypothesis 6: Employee-orientation practices are perceived to be more frequent in more individualistic contexts than in more collectivistic contexts.
Power distance is a second dimension, capturing the extent to which social relations are structured hierarchically. In more power distant societies, people are accustomed to and expect greater
power differentials in their work settings. This resembles the issue of control and formalization in
open systems. Hierarchical organization is a core mechanism of exercising central control. We
predict:
Hypothesis 7: Formalization practices are perceived to be more frequent in more power
distant contexts than in more egalitarian contexts.
Uncertainty avoidance refers to a desire to maintain stability and certainty in everyday situations
as opposed to a tolerance of uncertainty and ambiguity. This has some implication for the open
system concern of stability versus change associated with innovation practices. Innovation is often
inducing uncertainty and anxiety because of the changes to established work procedures and routines (West and Farr, 1990). To the extent that individuals within a society are more concerned about
maintaining stability, we could expect that levels of innovation practices are less frequent in
organizations. Therefore, we predict:
Hypothesis 8: Innovation practices are perceived to be more frequent in more uncertaintytolerant than in more uncertainty-avoidant contexts.
Finally, tightnesslooseness as the extent to which societies are more or less tightly regulated has been capturing the attention of researchers. Gelfand et al. (2011) recently created an
Fischer et al.
113
index of this dimension at the country level. In tighter societies, social norms are clearly
defined and imposed, whereas in loose societies, fewer norms are clearly defined and are less
reliably enforced and people are more likely to engage in risky behaviors. This dimension
therefore also has some relevance for both control and stability organizational practice
dimensions. Control can be established through specialization and formalization of hierarchies
and roles. In tight societies, there are more draconian laws (e.g. death penalty), more censorship, and control of the media, and citizens are less likely to participate in protests or sign
petitions (Gelfand et al., 2011). Gelfand et al. (2006) predicted that in tight societies, organizations will be more tightly controlled, orderly, and cohesive. Given the moderate correlation
with various indicators of power distance and hierarchical differentiation, we predict tightness
looseness is associated with greater formalization:
Hypothesis 9: Formalization practices are perceived to be more frequent in tighter contexts
than in looser contexts.
Tightnesslooseness is also likely to be associated with innovation practices (Gelfand et al.,
2006). In tighter societies, people are socialized to be more cautious and less risk oriented, prefer
structure and have higher impulse control (Gelfand et al., 2011). This is likely to lead to a preference
to stick with the status quo and prefer stability in organizations, whereas in looser societies, individuals and organizations may be more likely to endorse an orientation toward innovation (Gelfand
et al., 2006). Therefore, we predict:
Hypothesis 10: Innovation practices are perceived to be less frequent in tighter societies than
in looser societies.
Method
Participants
A total sample of 1239 employees from various organizations participated in this study. In Brazil
and Malaysia, employees taking evening classes or participating in an executive Master of Business
Administration program voluntarily completed surveys during class time. The response rate was
100 percent, since no one declined to participate. In New Zealand (NZ), Turkey, the United States,
and Argentina, participants from various organizations were recruited. NZ participants were
approached in the financial district and asked to participate in a short study. In Turkey, Argentina,
and the United States, organizations were recruited through existing research and personal networks
of the researchers. The response rates varied between 32 percent in NZ and 90 percent in Turkey. No
information on the response rate was collected in Argentina. We obtained overall ethical approval
for running this study from the School of Psychology Ethics Committee at Victoria University of
Wellington, New Zealand.
There were equal numbers of males and females in all samples: 2(5) = 2.63, p > 0.05.
Although the majority of employees were employed in the private sector (61.6 percent), there
were differences between the cultural samples: 2(5) = 105.44, p < 0.001 (see Table 1 for
demographic differences). The majority of participants were working in service industry (60.0
percent) or primary and manufacturing industry (30.1 percent) but the proportion varied:
2(10) = 165.48, p < 0.001. Similarly, there were differences in organizational position across
samples: 2(15) = 450.08, p < 0.001; age: F(5,1221) = 13.33, p < 0.001 and average tenure
F(5,1046) = 13.97, p < 0.001 (see Table 1).
114
Table 1. Demographics.
Brazil
Malaysia
New
Zealand
Turkey
The United States
215
39.1
11.3
275
35.9
8.9
81
33.2
8.7
310
37.7
5.4
200
31.8
7.6
158
34.0
5.3
3.3
15.3
79.5
18.2
62.5
8.4
8.6
42.0
7.4
14.2
23.9
26.5
6.5
32.5
44.5
5.7
28.5
44.3
57.6
48.8
84.7
32.4
62.5
64.4
27.2
72.8
60.5
14.5
72.9
48.1
39.5
45.5
70.0
18.4
57.6
41.8
Argentina
N
Age (years)
Tenure (years)
Organizational position (percent)
Senior management
Middle management
Process/clerical workers
Main industry (percent)
Primary industry
Service industry
Private sector
Measures
Organizational practices. Items from existing organizational culture scales focusing primarily on
values (Allen and Dyer, 1980; Newman and Nollen, 1996; Quinn and Spreitzer, 1991; Tang et al.,
2000; van Muijen et al., 1999; Verbeke, 2000) were scanned to identify items that could capture
organizational practices. Those items were then rewritten to focus on the organizational practices
directly instead of focusing on the values. The aim was to cover a comprehensive range of
organizational practices. Our prediction was that this broad range of items would cluster
according to the three underlying types of conflicts inherent in open systems (Argote and
McGrath, 1993). All items were extensively discussed in laboratory group meetings at the first
three authors institutions as well as in discussions between the first three authors until agreement
was reached about definitional clarity and precision. A total of 71 items were created. The items
were simultaneously created in English, Portuguese, and Spanish. A back-translated Turkish version was compared with the English and Portuguese versions, and minor corrections were made.
The English version was used in Malaysia. Items were presented with the following instruction:
Below you see a number of statements about work practices. Please indicate how frequently each
of these situations occurs in the organization in which you work. In the translations, we made
sure that perceptions were equally focused on the specific organization that the respondent was
working for. This treatment is in line with a long tradition in organizational research in which
respondents are asked as informants about the organization and its culture (Fischer, 2009; Glick,
1985; James et al., 1988). Chan (1998) formally described various referent models, including the
referent shift model that is used in the current study. Responses were recorded on a seven-point
Likert-type scale, with the response options ranging from never to always.
Macro-level variables. The GNI per capita and gross domestic product (GDP) growth per capita
were used as economic control variables (World Bank, 2004). The average income per capita was
US$4220 in Argentina, US$2830 in Brazil, US$3540 in Malaysia, US$13,260 in NZ, US$2490 in
Turkey, and US$35,400 in the United States. We used the culture-level indicators developed by Hofstede (2001) as indicators of individualism, power distance, and uncertainty avoidance. These
Fischer et al.
115
dimensions have been well validated in organizational contexts (see Kirkman et al., 2006). We
used the tightnesslooseness index developed by Gelfand et al. (2011). It is a new index based
on perceptions by adults of how tightly regulated a society is. The index has been validated
against a number of macro-level indicators and behavioral constraints at the individual level (see
supporting online material in Gelfand et al., 2011). No data for Argentina was available. Therefore, we ran the analyses twice: first without Argentina and then with Argentina and assigning the
combined score for the two South American nations (Brazil and Venezuela), for which tightness
looseness data are available (mean = 3.6).
Results
Factorial structure
We submitted the full data set of 71 items for exploratory factor analysis. We followed guidelines
outlined by van de Vijver and Leung (1997) and Fischer and Fontaine (2010). We centered each
item around the mean in each sample to avoid confounding the factorial structure with mean differences (Fischer, 2004; Leung and Bond, 1989). We first conducted an exploratory analysis
(principal component analysis (PCA) with varimax rotation) of the combined sample as well as of
each sample separately. A number of factors (two to seven) were extracted, but a three-factorial
structure showed the most consistent and explainable structure. We then deleted seven items that
did not clearly load on one of the three factors in the total sample. These 64 items were submitted
for a second PCA with varimax rotation. Cattells (1966) scree test showed a clear three-factorial
structure in each sample as well as in the overall sample. Using procrustean rotation (van de Vijver
and Leung, 1997), we compared the structure in each sample with the overall sample solution.
Another 18 items were identified that showed different loadings across samples on the three factors.
In addition, various items that had insufficient factor loadings (below 0.30) on a single factor, as
well as items with large cross-loadings on more than one factor, were also identified. The resulting
29 items were submitted for final analysis. A clear three-factorial structure again emerged that
tapped the three proposed practice dimensions of employee orientation, formalization, and innovation. These three factors explained 57.5 percent of the total variance in the whole sample and
between 54.5 and 64.4 percent of the variance in each sample separately. We used congruence coefficients to evaluate the similarity of factor solutions, with values >0.90 indicating high factorial
agreement (van de Vijver and Poortinga, 2002). Mean congruence was 0.97, with all but one value
being higher than 0.90 (0.88 for the congruence of innovation practices in Malaysia). We therefore
found a clear three-factorial structure in all samples that matches the three underlying conflicts
inherent in open systems.
For conceptual reasons, we decided to exclude a number of items from our scales since they seem
to tap into less central aspects of each factor. Consequently, we have 10 items clearly measuring
employee-orientation practices and 7 items measuring formalization practices and innovation practices. Table 2 reports the final solution in the common matrix. In the following analyses, we will
only use this reduced set of items.
Internal consistencies
The internal consistencies using Cronbachs were excellent in all samples. The mean for employee
orientation was 0.93 (0.92 in Brazil; 0.94 in NZ; 0.93 in Argentina; 0.92 in the United States; 0.95 in
Turkey; and 0.92 in Malaysia). The reliability for formalization practices was on average 0.83 (0.80 in
116
Table 2. Factor loadings in the common matrix.

Employee
orientation
Items
Managers give employees freedom to express their ideas
Employees are respected
Employees have a say in matters that directly involve them
Managers encourages employees to speak up, when they disagree
with a decision
Each employee is treated as a total person
Employees are supported by their superiors
Whenever an employee is ill, managers ask about him/her with
interest
Managers try to help employees to solve work problems
Criticisms raised by employees are discussed with the managers
Employees are informed on matters that directly affect them
The glue of the organization are formal rules and policies
What employees have to do is strongly determined by formal
procedures
Everything in the organization is done according to previously
defined procedures
The instructions are generally written down
The jobs are performed according to previously defined
procedures
Control and centralization are important
Routines and structure are some of the marked characteristics of
this organization
This organization frequently searches for new markets for existing
products
People are frequently searching for new products and services or
improvements for existing products and services
There is a lot of investments in new products in this organization
Innovation and risk taking is one of the marked characteristics of
this organization
Assistance in developing new ideas is generally readily available
There is an emphasis on competitive actions and achievements
People are always searching for new ways of approaching
problems
Formalization Innovation
0.83
0.80
0.79
0.76
0.06
0.13
0.10
0.13
0.19
0.20
0.20
0.21
0.75
0.75
0.72
0.11
0.16
0.21
0.15
0.29
0.10
0.72
0.69
0.64
0.11
0.12
0.21
0.10
0.24
0.79
0.77
0.24
0.17
0.30
0.07
-0.03
0.17
0.75
0.14
0.18
0.28
0.65
0.63
0.08
0.17
0.04
0.04
0.60
0.59
0.12
0.05
0.09
0.11
0.81
0.32
0.10
0.78
0.12
0.34
0.09
0.02
0.66
0.64
0.55
0.32
0.42
0.09
0.24
0.24
0.57
0.52
0.50
Brazil; 0.85 in NZ; 0.83 in Argentina; 0.81 in the United States; 0.86 in Turkey; and 0.87 in Malaysia).
The average reliability for innovation practices was 0.84 (0.83 in Brazil; 0.87 in NZ; 0.83 in
Argentina; 0.86 in the United States; 0.89 in Turkey; and 0.74 in Malaysia). Means and SDs for the
three organizational practices per country are presented in Table 3.
Hypothesis testing
To test our hypotheses, we conducted a cross-level operator analysis (CLOP; see James and Williams,
2000). This variant of a regression analysis is conceptually similar to hierarchical linear modeling and
Fischer et al.
117
Table 3. Organizational practice means and SDs per countries.
Argentina
Brazil
Malaysia
New Zealand
The United States
Turkey
Mean
SD
Mean
SD
Mean
SD
Mean
SD
Mean
SD
Mean
SD
Employee orientation
Formalization
Innovation
4.19
1.32
4.46
1.13
4.40
0.96
4.99
1.03
4.83
1.12
4.79
1.30
4.75
1.19
4.78
.94
5.02
0.94
4.87
.96
4.92
0.89
5.01
1.11
4.00
1.20
4.35
1.09
4.20
0.84
4.29
1.09
4.34
1.18
4.75
1.24
can be used when the number of level-2 units (in our case, cultures) does not allow the use of programs
such as hierarchical linear modeling (HLM; Raudenbush and Bryk, 2002). Both analyses will yield
very similar parameter estimates (regression coefficients), but they will differ in the estimated effect
size and standard error. The main difference is that CLOP does not partition variance into within- and
between-unit components: both individual-level and unit-level variables are used to explain variance
at an individual level (Klein et al., 2000). Therefore, in contrast to HLM, using CLOP, the effect of
between-unit variables will appear smaller because the effect of higher level variables is used to
explain total variance in the dependent variable rather than only between-unit variance (as in HLM).
In addition, in CLOP, standard error estimates are based on total variance, compared with HLM, which
partitions variance at the two levels. One consequence is that standard errors for higher level variables
tend to be smaller. CLOP is primarily used when the sample size limitations prevent the use of HLM
(James and Williams, 2000). Hence, because this analysis provides useful information, we will use it
for our exploratory analyses of cultural effects on organizational practices. For more detailed discussions of the differences between HLM and CLOP, see Klein et al. (2000).
We first entered dummy codes for organizational position (management vs. others) testing
hypothesis 1, sector (private vs. public) testing hypothesis 2, and industry (primary/manufacturing
vs. others and service vs. others), gender (male vs. female), employee age, and employee tenure as
control variables. The GNI per capita and GDP growth per capita were used as macroeconomic
variables (World Bank, 2004). We entered these two variables next prior to the cultural variables
since it is often found that economic variables covary with cultural effects. Therefore, our analysis is
more conservative by controlling for macroeconomic effects first. Finally, we used the Hofstede
dimensions (Hofstede, 2001) and tightnesslooseness (Gelfand et al., 2011) to estimate cultural
variability. Since our analyses were exploratory, and entering all dimensions would have reached the
limits of CLOP given our sample size (a maximum of k 1, in our case four higher order variables),
we entered the cultural variables stepwise. Only those variables that had the highest and significant
semipartial correlation with our dependent variables were entered. Table 4 reports the results.
Hypothesis 1 predicted that managers would perceive higher levels of employee-orientation and
innovation practices. The effect of managerial position was significant and positive for employeeorientation and innovation practices (it was marginally significant without Argentina, but became
118
Table 4. Cultural differences in organizational practices.
Step 1
Managerial position
Primary industry
Service industry
Private sector
Males
Age
Tenure
Step 2 (macroeconomic variables)
GNI per capita
GDP growth per capita
Employee
orientation
Innovation
orientation
Formalization
F(7,1044) 1.91,
DR2 0.013
0.08*
0.05
0.02
0.02
0.03
0.02
0.05
F(7,829) 3.75**,
DR2 0.031
0.06^
0.10
0.03
0.12**
0.01
0.01
0.04
F(7, 1044) 1.97^,

DR2 0.013
0.00
0.02
0.02
0.09**
0.02
0.06
0.03
F(2,1042) 11.74**, F(2,827) 21.02**,

DR2 0.022
DR2 0.047
0.07*
0.16**
0.12**
0.13**
F(2,1042) 3.35*,
DR2 0.006
0.04
0.06^
Step 3 (cultural variables, stepwise entry) F(1,1041) 39.90**,

DR2 0.036
Individualism
0.21**
Power distance
Uncertainty avoidance
Tightnesslooseness
F(1,826) 4.85*,
DR2 0.005
0.09*
Note: GNI: gross national income; GDP: gross domestic product growth (World Bank, 2004).
*p < 0.05; **p < 0.01; ^p < .10.
significant when Argentina was included) and therefore supports the hypothesis. Hypothesis 2 predicted that formalization practices are perceived to be higher in public sector than in private sector
organizations and innovation practices are lower in public than in private sector organizations. The
effect of sector was significant for formalization and innovation orientation, supporting hypothesis
2. Public sector organizations are perceived to have higher formalization, but lower innovation practices compared to private sector organizations. Our research question concerned the effect of industry. We did not find any significant effects in our sample.
After controlling for industry and employee effects, significant effects of GNI and GDP on
employee orientation were found. In richer countries where individuals on average have a higher
income per capita, organizations seem to focus less on employees (supporting hypothesis 3b and
rejecting hypothesis 3a), while in faster growing economies, organizations pay more attention to
employees (in line with hypothesis 4). Hypothesis 5 was also confirmed. In faster growing
economies, organizations are perceived to be more innovation oriented. Interestingly, the effect of
GNI was also significant, indicating that in contexts where individuals have a higher income,
organizations are perceived as adopting less innovation-oriented practices.
Finally, after controlling for these macroeconomic variables, we found a significant effect of
individualism on employee orientation. In more individualistic cultures, organizations pay more
attention to employees, which supports hypothesis 6. Hypothesis 7 was not supported as we did
not find an effect of power distance on formalization after controlling for the demographic,
organizational, and macroeconomic variables. Hypothesis 8 was also not supported since
Fischer et al.
119
uncertainty avoidance did not significantly predict innovation orientation in our sample.
Hypothesis 9 predicted an effect of tightnesslooseness on formalization. When using only the
available data (excluding Argentina), the effect was not significant. When substituting the
tightnesslooseness mean of South American countries for Argentina, the effect was marginally
significant and in line with our hypothesis: = 0.08, R2 = 0.004, F(1,1041) = 3.86, p = 0.05.
Hypothesis 10 predicted a relationship between tightnesslooseness and innovation practices.
When excluding Argentina (as no data for tightnesslooseness is available), the effect was significant and in line with predictions. Greater tightness is associated with less innovation. However, this effect disappeared when using the averaged South American mean for Argentina (partial
correlation 0.026, p = 0.4, predictor is not entered in stepwise regression). As we have no
information on tightnesslooseness in Argentina, the substitution of the missing data with the
average of the other two South American countries is probably not very reliable. Therefore,
hypotheses 9 and 10 are only weakly supported.
Discussion
In the present study, our first aim was to test whether a three-factorial structure underlies existing organizational practice items in six different cultural contexts. We found a clear three-factorial structure in
each cultural context, characterized by employee-orientation, formalization, and innovation practices.
Second, we tested specific hypothesis regarding individual, organizational, and cultural differences in these perceived practices. To the best of our knowledge, we are providing one of the first
tests of the impact of these diverse variables across multiple levels on perceptions of organizational
practices. We test effects of the new dimension of tightnesslooseness and its importance for
organizational research across cultures.
First, we found the predicted effects of managerial position and sector on perceived practices.
Managers perceive greater innovation and employee orientation. Public sector organizations were
perceived as adopting less innovation orientation and more formalization practices when compared with private sector organizations, in line with previous research (Fischer, 2008; Kabanoff
and Daly, 2000). Private organizations are guided by the main objectives of satisfying clients
needs and making a profit (Guerra et al., 2005). Being innovative can be a good way of attaining
these goals. Public organizations, in contrast, do not have to compete for clients, since their main
goal is to provide public services for the general public, and therefore their work is governed by
rules and legally established indications (Guerra et al., 2005). In short, we found consistent and
meaningful differences across sector and organizational positions. These results provide useful
validation information by showing that our instrument discriminates between sectors and organizational positions.
Concerning industry and cultural differences, we found no main effects of industry, but variables
at the national level significantly predicted perceived practices across samples. A large scale study
by van Muijen et al. (1999) concluded that organizational practices are more likely to differentiate
between industries than between cultures within Europe. Our findings are more in line with those of
the GLOBE project. Brodbeck et al. (2004) found that cultural effects are significantly and consistently larger than any industry effects in a broader sample of nations. Because our sample sizes
did not allow us to use a finer differentiation between individual industries, we had to rely on a
general comparison between service, primary/manufacturing, and other industries. Therefore, our
categorization of industries may have prevented us from finding a significant effect of industry. It is
also likely that smaller cultural differences in Europe could explain the particular results obtained by
120
van Muijen et al. (1999). Overall, our results point toward cultural differences being important and
actively shaping organizational practices when comparing countries across a broader range of
cultures.
Our third objective was to explore the effect of macroeconomic dimensions on perceptions of
organizational practices. We found strong effects of macroeconomic conditions on perceptions of
organizational practices. In line with our compensation hypothesis (hypothesis 3b), in lower income
countries, the perceptions of employee-orientation practices are higher than in higher income countries. This suggests that organizations in economically less developed contexts may use nonmonetary
incentives and socially focused practices to maintain high levels of morale and employee well-being
within them. This compensation mechanism may allow organizations to maintain a healthy and motivated workforce even when economic means are limited.
At the same time and supporting hypothesis 4, we found that within organizations, in faster
growing countries, the perceptions of employee-orientation practices are higher. In these contexts,
more job opportunities abound, and employees may have relatively more freedom to move to other
(potentially better paying) competitors. If organizations do not take care of their employees, especially the good ones, they are likely to lose their competitive advantage through high turnover. Previous studies on organizational commitment at the cultural level have found similar results (Fischer
and Mansell, 2009). The greater availability of slack resources in fast-growing economies probably
also explains the significant effect on innovation practices (supporting our hypothesis 5). Together,
these findings about the effect of macroeconomic variables on organizational practices underscore
the importance of ecocultural frameworks (Georgas and Berry, 1995), showing that economic variables have an important effect on organizational variables within cultures. Of particular importance
is that current wealth and income growth can have opposing effects. This is an issue that needs more
consideration in future research.
Our fourth aim was to explore national culture effects on perceptions of organizational practices.
We found a strong effect of individualismcollectivism on employee orientation. This is in line with
arguments that the individual is the central focus in individualistic societies and organizations need
to pay attention to individuals to maintain a loyal and committed workforce. In more collectivistic
societies, loyalty is less dependent on treatment by the organization and more governed by normative mechanisms (e.g. Fischer and Mansell, 2009). These findings are in line with other crossnational research on psychological contracts (Rousseau, 1989, 2001).
We also found some effects of tightnesslooseness on practices. We found a significant effect on
innovation practices in line with predictions by Gelfand et al. (2006). In tighter societies, innovation
practices were less frequently perceived. This effect was observed when excluding Argentina, as no
reliable data were available. When substituting the mean across South American countries, the
effect of tightnesslooseness on formalization also approached significance. One of the major
problems with tightnesslooseness is that data are available for only a limited number of countries.
Our results show that it is a promising variable and can contribute to our understanding of organizational processes. Unfortunately, we were unable to collect data directly, as the instrument was
only published recently. We strongly encourage future researchers to examine and collect information on this variable.
Limitations
We proposed that items of our instrument would cluster according to the three specific dimensions of
conflicts in organizations. However, it is possible that other items are relevant for measuring these
Fischer et al.
121
conflicts. Issues of domain underrepresentation (Fontaine, 2005) cannot be ruled out through statistical
testing. This requires qualitative inquiries in each cultural context in order to examine whether additional
items are important for measuring each dimension of conflicts in each specific cultural context.
Moreover, the sampling strategy used was selected so as to obtain a variety of respondents from
as many different organizations and backgrounds as possible within each country. Our aim was to
obtain a broad cross section of employees from various organizations and industries and not to
match industries or organizations across countries, since there are large differences across societies
in the types of industries being present in each one (as well as their status, position, sector, etc). The
presence and relative contribution of specific industries to employment in each society depends on
various factors, including the availability of natural resources, economic development, and consumer demands. For this reason, we were interested in samples that represent the industries and
types of organizations present at each location. However, the representativeness of this strategy
cannot be determined and future studies could compare results on more directly matched samples
from specific industries across different societies.
It is also important to note that our use of general sampling strategies at the individual level did not
allow us to determine whether perceptions about the organizational practices are shared and capture
organizational culture as a collective construct (which is implied in the definitions of organizational
culture, see Fischer, 2009). Future research should estimate the agreement among multiple raters.
Finally, response bias may have influenced our results, since we relied on a cross-sectional
design with self-reports. However, various studies have shown that such problems are less severe
than previously assumed when focusing on readily verifiable organizational practices (Crampton
and Wagner, 1994).
Conclusions
Our study is an important step forward in the quest to study organizational culture across national
cultures. We have provided a systematic assessment of organizational practices in a variety of
cultural contexts, including less well-studied samples from Latin American and Asian countries,
using established organizational theory as an inspiration. It would be important for future work
to show the links between theoretical types of conflict and organizational practices more directly,
for example, by measuring the types of conflict and relating them to our derived organizational practice dimensions. Since we are not aware of any measures that tap into these conflicts inherent in
open systems directly, it would be important to develop these and then examine these proposed links
across a larger number of organizations and countries.
Our study also makes an important contribution by relating these perceived practices to individual,
organizational, economic, and cultural effects. To the best of our knowledge, we are the first to test
these effects comprehensively with a broader range of samples. The instrument and the framework
show much promise for conducting multilevel studies on organizations and culture in the future.
Funding
This research received no specific grant from any funding agency in the public, commercial, or not-for-profit
sectors.
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Organizational practices across

Maria Cristina Ferreira and Eveline Maria Leal Assmar

Gulfidan Baris, Gunes Berberoglu and Figen Dalyan

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