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Impact of Culture on Innovation Adoption

Info: 1874 words (7 pages) Example Literature Review
Published: 6th Dec 2019

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Tagged: Business

Understanding of role culture in the international business is one of the critical success factors for the international manager. Without the knowledge of the local culture of the firm and as well as that of the customer culture the manager cannot be successful (Luthans, et al. 2003). Because the company products fruitful in one culture may not be in other culture (Twati& Gammack, 2006). The culture has defined by different researchers in different ways for different perspectives (Jones and Alony, 2007; Rosman and Rubel, 1995). But the most appropriate for the international business perspective is that of the (Luthans, et al, 2003). According to him culture is the acquired knowledge that people use to interpret experience and generate social behaviour. The culture is the basic thing because of which the individuals show variation in their behaviour to different business activities. As in this paper focused is on the impact of the culture on innovation adoption. So along with the explanation of the culture the explanation of the innovation and adoption process is also necessary. Like culture innovation is also a broaded term and has been defined by different researcher in different ways for different purpose (Lumpkin and Dess, 1996). The innovation is the phenomena of bringing changes (Damanpour and Gopalakrishnan, 1998). These changes may be in different ways like changes in the products or services, method of changing the production cycle, variation of inputs in production, changing the technology of the production, change in finance structure, change in the marketing mix etc (Porter and Van, 1995). For the international business prospective we consider the broad definition of the innovation. That innovation is the firm capability of developing new products, ideas, methodology of operations which lead to new effective outputs for the business (Lumpkin and Dess, 1996). There are number of sources for the innovation process like business innovation source, end user innovation source, and manufacture innovation source. The innovation may be of various types like that of the minor innovation in which a minor change occur, disruptive innovation is such in which complete change in product or services occur, and business innovation is such in which improvements are brought in operation of the business activities in a beneficial way . The last component of this article is

innovation Adoption process. The innovation adoption is the simply the willingness toward the acceptance of innovation.

This paper shows the factors effecting the innovation adoption in general. But the primary focus of the paper is to describe the impact of social factors (culture) on innovation adoption. Hofstede cultural dimensions are used to describe the impact of the culture on innovation adoption.

Literature Review:

The process of innovation adoption is one of the major driving forces for the economic development of the country (Rogers, 2004; Rosenberg, 1972). In past different researchers has done work on the driving factors of the adoption processes (Griliches, 1992; Mansfield, 1963; Rosenberg, 1972). Different researchers’ views were that only economic factors (per capita income and GDP) are driving forces affecting the innovation adoption process (Comin & Hobijn, 2004; Hall & Hall, 1990; Caselli & Coleman, 2001; Rosenberg, 1972). But however there are some countries that having same economic condition but inspite of this there are variation in the adoption (Ark, Van, Inklaar, & McGuckin, 2002; Meijer & Ling, 2001). Thus this shows that the economic factors are off course the driving forces of adoption but, along with them there are some other forces which affect the process of the innovation adoption (Barnett 1953). These factors are the social factors which affect the innovation adoption processes (Rosenberg, 1972). Culture is critical factor in diffusion processes (Maitland, 1999). There is positive relation of culture and its impact upon innovation (Goodman, Press, Ruth, and Rutkowski, 1994). Lack of global culture knowledge is source of failure for the businessmen (Champy et al, 2009). Thus in cross border there is variation in the innovation adaption process due to different factors includes economic, social, and technological (Hii and Neely 2000). A cultural model was proposed by lee and Peterson (2000) which shows that culture have effect upon the innovation Adoption

processes. In the global world the innovation adoption vary from country to country due differences in culture (Waarts and Everdigen, 2005).

The cultural dimensions are the key factor for the adoption processes (Waarts and Evidergen 2002). Culture is critical factor in the adoption or rejection of Innovation (Wang et al, 2009). The culture is composed of different dimensions and due to variation in these dimensions there exist variation in the innovation adoption in different country (Deshpande and Farley, 2005). The difference in adoption is due difference in the countries cultures (Yalcinkaya, 2005). Inventor is affected by the dimension of the culture (Liu, et al, 2009). Cultures affect the firm innovation processes. Business culture effect the adoption processes (Baird et al, 2004). According to him business culture are the dimensional factor of the innovation adoption. Envirment of the business is directly associated with the business operation i.e. if the external envirment (culture) of the business is innovative than firm will be innovative (Patrick et al, 1997). The innovation is easily accepted is the innovative culture of the business (Rogers, 2004).

This is true that culture have major impact upon the innovation adoption of the firm. Which has been proved by many of the social researchers, but the question is that how can one measure that culture effects the innovation adoption. For the solution of this various cultural dimensions have been used by different social researchers. In early ages the researcher uses the different types of culture dimension for this purpose like collectivisms, individualism, self-orientation, collectivity orientation, multidimensional and single dimension culture (Soares et al. 2005). Along with this House nine dimensions and Hall high and low context culture was also used for the measuring of the culture (Twati & Gammack, 2006). However the dimensions of the culture which are used by most of modern social researcher are the Hofstede culture dimensions (Sondergaard, 1994; Au, 2000; Pizman et al., 1997: Myers and Tan 2002: Clark, 1990; Sondergaard, 1994; Hofstede, 1980; Gregory et al, 1996; Steenkamp and Benedict 2001). The Hofstede culture dimension consists of four

dimensions which are Masculinity–femininity, Power distance, Uncertainty avoidance, Individualism–collectivism (Hofstede, 1980).

Power distance;

By this dimension of Hofstede means the unequally distribution of the power in the organisation (Hofstede, 1980). The Hierarchy of the organization shows the distribution of the power (Erumban et al, 2006). This dimension effect the organization in number of ways like if the hierarchy is flatter than there will be less power distance in different levels of the organization due to this there will be high rate of innovation and adoption and vice versa (Zmud, 1982). The researches have showed that if the employees are more authorized and give more power of decisions than there will be high rate of innovation (Mumford & Licua­nan, 2004; Lee & Peterson, 2000; Dwyer et al., 2005; Bulte and Stremersch, 2004; Flynn and Saladin, 2006).

Uncertainty Avoidance:

The uncertainty avoidance means avoid the situation/operation of business in which there is uncertainty of success (Hofstede, 1980). This dimension of the culture effect the organization in great way. This effect is measured in such a manner .the countries where the organization is most careful about it in such countries the management of the organization is more structural and is busy in making rules, regulations. In such organization there is less turnover and less ambitious employee and vice versa (Hofstede, 1980). And similarly higer level of care about uncertainty avoidance leads toward less innovation adoption (Stoneman, 2001; Freeman and Soete, 2000; Maitland, 1999; Rogers, 2004; Yalcinkaya, 2008).

Individualism and collectivism:

According to Hofstede in the individualism (ID) the people are more concern about themselves and their family only. While in the collectivism (IC) the people thinks in term of

Team/groups. They care about each others. Hofstede has notice that the people with wealthy economic condition thinks in term of individualism and vice versa. Higher ID is more innovative as compare to that of IC (Shane 1993). Country with high ID have high rate of the adoption ac compare to that of the IC (Erumban, 2006).

Masculinity and Femininity:

According to the Hofstede the situation in which success, things and money are the dominant values in society is called masculinity IM. While the situation in which the caring of others, quality of life are the dominant values in society is called as femininity IF. In country where is high masculinity the individuals are more innovative. So due to high innovativeness there is higher rate of the innovation adoption and vice versa (Hofstede).The country with higher IM have higher innovation adoption rate (Erumban,2006: Rogers , 2004; Stremersch and Tellis, 2004).

This paper focus upon the effect of the culture on the innovation adoption Processes, that the national culture have deeply effect upon the innovation Processes. The different Dimension of the culture effect the innovation and Adoption in different ways.

Research Design and Methodology:

The research paper was on ‘impact of culture upon innovation adoption processes.” Basically it was a descriptive research. The date was collected on culture, Hofstede cultural dimensions, Innovation, and adoption process. Secondary data was used in this research. The Data was collected from different sources like books and websites. Major portion of the data was from International published journals. The journals were downloaded from different internationals published journals data bases like Jistor, Science Direct, Emerald, science valley.

Conclusions and limitations.

By the use of the Hofstede cultural dimensions it has proved in this paper that, culture is the critical factor in the innovation adoption processes. Like others different factors it effect the rate of innovation adoption processes up to large extent. The Each dimension of the Hofstede effect the innovation adoption process. The limitations in this study are that it was conducted on secondary data and only one factor affecting the innovation adoption process was discussed in detail. So in future the researchers have to do this kind of study on primary data. The researcher in future should take multi factors like political, economic, and technological while studying factors affecting innovation adoption processes.

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