Long-Term Orientation
By Alexa DeFiore
Definition
"Long-Term Orientation stands for the fostering of virtues oriented towards future rewards, in particular perseverance and thrift. It’s opposite pole, Short Term Orientation, stands for the fostering of virtues related to the past and present, in particular, respect for tradition, preservation of ‘face’ and fulfilling social obligations.”- Gert Hofestede
Origin of Hofestede's Fifth Dimension
Gert Hofestede
Hofestede's fifth dimension, Long-Term Orientation, was added after his first four dimensions including individualism, masculinity, power distance index, and uncertainty avoidance failed to satisfy the criteria defined within. After collecting data from only 23 countries Hofestede wished to reach a higher portion of the globe.
Research data from 93 countries concluded China to be the country with the highest and Sierra Leon with the lowest ranked oriented cultures. This makes sense due to China's regard to tradition, all the way down to countries with the opposite views, like Sierra Leon. More specifically, research shows these countries have the following characteristics as seen in the chart below.
Countries with high regard for Long-Term Orientation, value persistence rather than immediate results. This plays a rather crucial role in business decisions where Long-Term Orientatied countries wish to establish a Long-Term commitment, while Short-Term Oriented countries wish to make decisions faster in order to achieve more immediate results. This is also seen in cultures where spending money is more common than saving. Additionally, cultures who practice higher Long-Term Orientation more commonly make rash judgments when it comes to investing in areas such as the stock market, real estate, luxuries, and further.
Research data from 93 countries concluded China to be the country with the highest and Sierra Leon with the lowest ranked oriented cultures. This makes sense due to China's regard to tradition, all the way down to countries with the opposite views, like Sierra Leon. More specifically, research shows these countries have the following characteristics as seen in the chart below.
Countries with high regard for Long-Term Orientation, value persistence rather than immediate results. This plays a rather crucial role in business decisions where Long-Term Orientatied countries wish to establish a Long-Term commitment, while Short-Term Oriented countries wish to make decisions faster in order to achieve more immediate results. This is also seen in cultures where spending money is more common than saving. Additionally, cultures who practice higher Long-Term Orientation more commonly make rash judgments when it comes to investing in areas such as the stock market, real estate, luxuries, and further.
Elements of Long and Short-Term Orientation
High Long-Term Orientation
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Low Long Term Orientation (aka Short-Term Orientation)
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Measurement Sample
The LTO for Saudi Arabia remains unreported
Confucian Dynamism (LTO) rates the long-term or short-term orientation of a country. The United States scored a 29, far below the worldwide average of 48. These results allow us to conclude that United States values short-term concepts more than long term ones. This is seen as especially true when members of societies value meeting obligations and appreciating cultural traditions more than it values long-term ones. These are often referred to as newly adapted tradition due to the interest in thrift and perseverance. It is also a manageable tool that has been adapted to combat the undesirable economy facing us across the globe.
Comparing Long Term Orientation with Short term
Similar to Confucius' search for virtue, a society's Long-Term Orientation relates to the way their future is focused, rather than regarding immediate results. The status of an individual as it pertains to cultural power, race, etc is regarded highly. Our Skype partners expressed this in much detail especially as it relates to relationships. For example, cultures with lower Long-Term Orientation standards more likely accept interracial and cross cultural relationships to exist.
Citizens belonging to countries oriented Long-Term more commonly value spending their money frugally and enjoy thrift options such as clearance items when shopping. Short Term Oriented countries prefer to follow along with tradition rather than take a route of saving their money with the drawback of having to sacrifice some of the things one wants. For example, a member of the Long-Term Orientated country might go to the grocery for fruit hoping to buy strawberries, but when he or she sees the blueberries are on sale she is likely to buy them instead. In contrast a Short-term Oriented woman may travel to the produce section hoping to buy strawberries and be content with this because she plans to make her traditional strawberry shortcake for her weekend guests.
Citizens belonging to countries oriented Long-Term more commonly value spending their money frugally and enjoy thrift options such as clearance items when shopping. Short Term Oriented countries prefer to follow along with tradition rather than take a route of saving their money with the drawback of having to sacrifice some of the things one wants. For example, a member of the Long-Term Orientated country might go to the grocery for fruit hoping to buy strawberries, but when he or she sees the blueberries are on sale she is likely to buy them instead. In contrast a Short-term Oriented woman may travel to the produce section hoping to buy strawberries and be content with this because she plans to make her traditional strawberry shortcake for her weekend guests.
How to Reach the Most Effective Organized Culture
By achieving values of low power distance, low masculinity, low uncertainty avoidance and high Long-Term orientation an organized culture becomes more likely. Cultures can function in the best ways possible as researched by Hofestede. Increasing Long-Term Orientation is crucial because it plans for greater organizational success. This can be achieved in many ways, some of which include embracing socially beneficial goals such as industrialization, modernization, and regional commitment.
Sources
"A measure of long-term orientation: Development and validation." Journal of the Academy of Marketing Science . 34.3 (2006): 456-476. Web. 26 Jan. 2013.
"Ethical Values and Long-term Orientation." Journal of Business Ethics . 71.3 (2007): 264-273. Web. 2 Feb. 2013.
Hofstede (2001), Culture’s Consequences, 2nd ed., p 359
G. Hofstede, B. Neuijen, D. D. Ohayv, G. Sanders. “Measuring Organizational Cultures: A Qualitative and Quantitative Study Across Twenty Cases,” Administrative Science Quarterly, 35, no. 2, (1990).
Long-term orientation: Implications for the entrepreneurial orientation and performance of family businesses
G.T. Lumpkin, Keith H. Brigham, Todd W. Moss Entrepreneurship & Regional Development Vol. 22, Iss. 3-4, 2010
Personal Interview
AlMas, Razan. Interview by Alexa Defiore and Ryan Millikan. Personal Skype interview. 2 Dec. 2012.