Cultural differences between countries have strong effects on individual personality and behaviour, as well as on organizational culture (Hofstede 2001). These differences can be a significant barrier for a manager, especially for one who is working in a foreign country. Failure to understand and adapt to these differences may result in culture shock, which can have adverse affects on a manager's performance. "Power distance" is among one of five cultural measures, devised by Geert Hofstede (1980, p. 84), which helps managers identify and understand the differences between national cultures. A nation can have low, medium or high power distance. These different aspects of power distance shall be explained using examples based on the case study Middleton. The report shall begin by discussing Hofstede's cultural measures and defining power distance. Following this will be discussion of power distance in Australia and Malaysia, which are the cultures presented in Middleton.
Hofstede devised of five measures, called dimensions, to describe national culture. They include individualism versus collectivism, power distance, uncertainty avoidance, quantity versus quality of life and time orientation. The "power distance" dimension is a cultural characteristic, which defines the extent to which inequality in power is accepted and considered as normal by less powerful people in a society (Hofstede 1980). It is measured by the power distance index (PDI), which was used to scale the beliefs of 100,000 individuals throughout 53 countries. A country's PDI index score can range from 1-100+. According to Hofsede's survey (see appendix, figure 2), Australia ranks 41st with a PDI score of 36 whereas Malaysia ranks 1st with a score of 104. Therefore Australia has low power distance and Malaysia high power distance, in fact the highest out of the countries surveyed. .
Australia has low power distance, along with other western countries such as Great Brittain and the United States.