Culture of Indonesia

The aim of this essay is to discuss the differences of the culture of two different nations which are geographically nearer to each other but culturally quite far. The countries in these days though have different social and traditional cultures easily meet through business. Through globalisation, the companies of one country enter the market of another country and gain knowledge about the culture, society, perspectives and demand of the customers. In knowing all these, these international companies understand the methods to manage the local workforce and adapt themselves with that culture. Gaining proper knowledge of the cultural factors of the country in which the company will enter is vital because this consists of value, understanding, perception, expectations, communication and most importantly innovation of the firm depends.

The firm now a days make decisions of entering a new market only after it gets political, legal, economic and social security. In this respect, proper understanding of social and cultural gap between two countries is essential as the companies can cope up with the political, legal and economic matters with time but cannot adapt with a new culture if the firm does not have any prior knowledge about the institutional culture of the country. This will directly affect the production of the firm by affecting the negotiation process, agreement matters and delivery of the goods and services. As the human resource is the backbone of any company, therefore, knowing the expectations, ability and management of the workforce is needed. This also helps in communication and managing the supply chains as well as customers as the brand can reach the roots quite easily by capturing the essence of the country’s country. For instance, the National Australia Bank if enter the Indonesian banking market need to know Indonesian characteristics so that it can behave as well as communicate efficiently to motivate the employees of the country.

This essay will discuss the cultural differences between Australia and Indonesia, main institutional differences between these two countries and some possibilities to standardize HRM policies so that the firms of Australia can easily enter the market of Indonesia and operate successfully without any cultural barriers. 

Indonesia has more than 17500 islands making the country to be the largest archipelago of the world. This nation is stretched between Australia and Asia with a huge amount of varieties of language, culture, religion and ethnicity. On the other hand, the cultural, religious and traditional diversity in Australia are not less but these cultures have no similarity with the diversity of Indonesia. Therefore, National Australia Bank whole entering the market need to consider the cultural differences between Australia and Indonesia so that it can relate this knowledge with the customer demands and expectation of the employees as well as supply chain.

Culture of Australia

The culture of Indonesia has been shaped and reshaped by different factors which include original aboriginal customs as well as a huge number of foreign influences. Moreover, this has been a route of trading between the far east, middle east and southern Asia. This is also the reason why the place is so diverse culturally. Among other essential factor that affect the culture of a place is the religion. Indonesia has multitudes of religious beliefs which include Hinduism, Islam, Buddhism, Christianity and Confucianism. Due to this reason the trading cities of Indonesia is full of diverse culture making the workforce from different cultural background. The traditional performing art like dance, music, drama and theatre, visual arts like paintings, sculpture, architecture, crafts, literature and foods have diversity with culture. The tourism industry in Indonesia is constantly flourishing due to proper utilisation of this cultural diversity of the country (Saddhono 2015). The recreation and sports of the country has influence of different cultures present in this country in which martial art of this place is one of the most important attraction for the tourists. All the cultural factors perfectly capture the essence of individual culture present in the country.

On the other hand, Australia is also a culturally diverse place but essentially follows the western culture mainly derived from Britain. This country also has a huge number of aboriginal people who mainly reside in the Aboriginal and Torres islands. However, there is a sharp contrast between the culture of these two sections and the organizations often face issues of discrimination (Thorpe Galassi and Franks 2016). The country has increased cultural diversity as there are waves of multi-ethnic migration in Australia for more than hundred years and these people have settled in the vast region of the country.

The difference in the culture between Indonesia and Australia has also affected the institutional cultural values and expectation of the labour forces of that country also. This is the reason why there are several institutional differences between Australia and Indonesian organizations. The organizational differences can be measured by the cultural dimension of Hofstede. According to the cultural dimension theory of Hofstede, there are six dimensions by which the organizational culture of a country can be measured (Harris and Tregidga 2012). These are power distance, individualism, masculinity, uncertainty avoidance, long term orientation and indulgence. 

The power distance factor represents the structure of the organization the organizations with proper hierarchical structure actually tend to be unequal. High score in this particular factor shows that the culture of the society is a supporter of indulging in using power over the subordinates. According to the Hofstede model, the factor of power distance is completely different. In case of Indonesia, the score is higher than that of Australia which explains that the organisational structure of National Australia Bank is flatter than any bank in Indonesia (Nationalaustraliabank.com 2018). There are fewer hierarchical structure in this organization because the Australian institutional culture supports the method of sharing information as fast as possible. The communication style among the managers and subordinate employees are more formal than that of the Indonesian organizations as they have direct channels for communicating with one another. On the contrary, the Indonesian banks are strictly controlled by the higher-level managers. These managers expect full commitment from the employees as well as respect. In such a strong, the employees remain passive and fear to give any type of feedback and their innovative mentality gets supressed. This is the reason why they cannot take part in the decisions making process and take different ways to fulfil their tasks.  The high score in the power distance factor defines that the Indonesian organizations believe in the guru-student type of dynamics in the high and low-level employees.

Institutional Differences between Australia and Indonesia

In the characteristics of collectivism and individualism, it can be found that the Indonesian culture is much more collectivist than that of the individualistic society of Australia. This feature actually implies the degree of personal value in building relationship with groups. Most of the Australian companies like all the European countries, believes in individualism rather than the inner connectivity in the groups. On the contrary the Indonesians are more socialistic in nature. The employees on the organization are more likely to conform to the others (Coviello 2015).  This characterises is caused by combination of social, political and historical factors which had led to the uniformity of perception. The employees of National Australia Bank are most focussed on their individual performances as well as achievements. They expect rewards for their own performance based on their actual individual merits. They follow self-reliance and display initiatives in the performance-based tasks which affects hiring and promotion decisions.

The Masculinity dimension is not based on the gender differences in the companies but actually used for describing the features of the forcefulness namely masculine factors and caring for the fellow workers namely feminine characteristics. The masculine society are more aggressive to win and achieve the goals (Bird and Mendenhall 2016). Similarly, in the organization, the work progress, income and competition to get rewards are factors to identify that the organisation is masculine. Australian organisations are more masculine than those of the Indonesia’s. the fundamental issues are to find out the motivating factors and their capabilities to strive for the best in the workplace. The employees of National Australia Bank are proud of their achievements and success in lives which lays the base of hiring method as well as promotion decisions in the organization. Hence all the conflicts are resolved at individual level and everyone aims to win.

On the contrary, the Indonesian workplaces are dominated by caring and maintaining high quality of life. The employees of the Indonesian culture value equity, quality and solidarity in the working lives of themselves. This is the reason why the managers of his types of organization are more consensus (Gelfand et al. 2017). The conflicts of the workplace are resolved by the negotiation and compromise. In such setting the incentives in form of free time and flexibilities are allowed and the main focus of the HRM policies is in the status and well-being of the employees. Managers in this context is more supportive than the Australian managers. Indonesian HR managers pay more attention to the cooperation and maintain group interests rather than being only work oriented (Hendrick and Kleiner 2016).

Hofstede’s Cultural Dimensions

From the context of uncertainty avoidance both the countries show similar nature hence feel more or less threatened by the ambiguity of business and unknow situations. The Indonesian people believe in maintaining formal connection with the others despite they face ambiguity or complex situations. They try to keep satisfied those on whom their own lives and happiness depend.

Long term orientation is associated with the view that how the societies maintain the connection with past while dealing difficulties in the present as well as future. The societies score low in this regard are termed as normative ones and prefer to maintain a time-honoured tradition as well as norms and view the societal changes with suspicion (Jiang, Gollan and Brooks 2015). The societies with high scores take more pragmatic decisions and encourage thrift as well as efforts in the modern educational structures for preparing the members for future. In this particular context, the Australian culture is more normative than the societies of Indonesia. The people in this society follows every way to establish truth and normative in thinking (Brewster et al. 2016). These people have great respect for their traditions and show much less propensity to save for the near future. The organisational culture of Australia focusses in getting quicker results than those of Indonesia. On the contrary, the Indonesian people believe in the truth but they know that truth depends on the situation, time and context (Mackenzie, Golembiewski and Rahim 2018). Despite the fact that these people dhow respect and concern for their traditions but quickly adapt traditions with changing conditions. They have strong propensity for saving and investing in one hand and possess perseverance in achieving results.

In the indulgence index, the people try to control their desires and impulses and cannot enjoy their lives as well as effort successfully. Relatively lesser control refers to indulgent culture and strong control on the societies make the members restraint to avoid all types of pleasures in life. The Indonesian culture is a restraint one where the members of the society as well as organisations are pessimists (Hendrick and Kleiner 2016). The have the tendency to see things cynically and critically. This types of setting of the organizations do not put mush importance ion the leisure time hence control the gratification of their personal desires (Melling and Booth 2017). The employees of the organisations, have perceptions that their actions are controlled by the social and cultural norms hence control the gratification of their desires. They also feel that indulging the actions according to their desires are wrong. On the contrary, the Australian culture is much more indulgent because the members of such country generally exhibit desire to realise personal impulses. They prefer living life with pleasures hence they perceive the environment with positive attitude and show optimism in every tendency (Moore 2015). They put importance on having leisure time to attain success and spend money wherever they wish. The Australian organizations while working in this country therefore, must consider all these factors as these affect the institutions intensely otherwise there will be issues in HRM and the company will lose support of the customers and employees. 

Power Distance

As mentioned before, Indonesia is highly diverse from the cultural context which directly affects the HRM policies of the foreign comoanies while working in this particular market. This is the reason why there are some possibilities to standardize the HRM policies of National Australia Bank. First of all, the Sungkan culture of Indonesia supports the factors of power distance by the means of indirect communication as well as actions performed by the managers. Moreover, the organization cannot fire the employees with poor performance (Hendrick and Kleiner 2016). This create issues in the HRM for which the National Australia Bank can take few measures.

First of all, the HRM of the organization needs to have a great knowledge about the culture of Indonesia. This must include the differences of perceptions, interrelations as well as evaluations of the social situations along with the people who observe them. In the Indonesian branch, these differences must be named, explained and understood to be recognised (Jong et al. 2015). This is the initial step to attain mutual understanding as well as good corporations within the company.

Secondly the company needs to respect the foreign culture rather than implying that the couture of the domestic company is better than that of the host country (Harris and Tregidga 2012). This is the reason why the company needs to employ such expatriates who can easily adapt with the cultures and have knowledge how to retackle the expectation of the members of the host country. This will also assist the company to hire and retain a culturally diverse staff.

Thirdly, the HR of the company needs to form a cross cultural management team in the initial years of operation in the Indonesian market so that proper training can be given to both the local employees as well as the expatriates to adapt with the cultural gap of both these two cultures (Brewster et al. 2016) This team will ensure that the employees of both the culture can follow the direction towards the organisational goals (Oldham and Fried 2016). This team will take care of the resources so that everybody gets a fair chance to access the resources of the organization as well as needed information in order to complete the tasks given to them. National Australia Bank HRM needs to make the structure very clear to all the staffs so that no issue of misunderstanding may arise (Bruning and Campion 2018).

Collectivism and Individualism

Fourthly, National Australia Bank need to minimise the differences and make itself a synergistic organization. This will help the company to recognise the positive impact of cultural diversity (Tims and Bakker 2014). This context, the managers do not just avoid the impact or disadvantages of the cultural diversity but use them to get new ideas in operating the organization. More cultural diversity means more innovative ideas and concepts to run the business.

Fifthly, the HR management needs to attract top local talents depending on their skills and job level and retain them by using any method. Hence people will guide the company to operate in the completely new culture by bringing essential changes in the policies and regulations (Stahl et al. 2017). They will also help the HRM in solving issues regarding institutional cultural differences. Based on these insights the organization will arrange trainings on the hard as well as soft skills to cope with the change. This will lead to provide the employees security with their jobs and make them capable to handle any type of situation (Jong et al. 2015). 

Sixthly, the HRM of National Australia Bank needs to enhance the employee morale and job satisfaction by constantly upskilling the employees to create a quality employee experience (Harris and Tregidga 2012). By offering online trainings, flexi-time, incentives and work from home arrangements the company will be able to create employee experience a notch above organizational competition. In addition to this, fostering an institutional culture of continuous learning which will increase the personal and professional development of the employees leading to their job satisfaction (Galpin and Lee 2012).

Finally, taking care of the health and safety issues of the employees, National Australia Bank can manage many HRM issues in the workplace (Parboteeah, Addae and Cullen 2012). Not only maintaining the health and safety measures laid by the regulation of the country but also maintaining the psychological health of the employees. The cultural of the institution must not be increasing the stress level of the employees. This include higher demand and limited time which ca prevent the organization to build a resilient workforce without much time (Galpin and Lee 2012). By following these methods, NAB can effectively manage all the cross-cultural issues emerged in the human resource so the ranches operating in Indonesia.

Therefore, it can be concluded that Australia as well as Indonesia has a huge cultural diversity which affect the society in great extent and led to changes from time to time. However, Indonesian culture is more diverse to that of Australia. There are population with different ethnic background on the basis of religion, origin and values or beliefs. This is the reason why the National Australia Bank may face issues in entering the market of Indonesia and utilising the cheap labour force of the country. There are six dimensions according to the cultural dimension of Hofstede among which these two countries show wide opposition in five of these six dimensions. The employees with their understanding, values, perceptions, expectations, communication and productivity show huge gap which directly affect the innovation process or smooth operation of the firm. This is the reason why the management of the organization need to follow measures like making decisions to support and respect the diversity in the workplace. They can make a cross cultural management team which will be able to understand the demand of the local employees and cater their needs in the best manner possible. 

Masculinity

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