The impact of culture

Culture matters. It shapes and differentiates societies, organizations, groups, and individuals. Culture impacts the macro-, meso-, and micro-level of nations and regions. It affects all layers of our ‘Silicon Valley Innovation & Startup Model’. A little theory may illustrate the significance of culture in understanding cross-national differences. Cultural contrasts that are important in grasping how startup entrepreneurs who moved to Silicon Valley experience its dominant culture and how they incorporate its innovation values and business beliefs.

Culture produces societal institutions and is in turn imprinted by these institutions, they are interwoven in a dynamic pattern of interaction and causation. A culture may promote startup founding, and startups, in turn, may fuel a new business culture. A definition of culture that serves both theoretical and applied objectives is the definition by UNESCO: “Culture should be regarded as the set of distinctive spiritual, material, intellectual and emotional features of society or a social group, and that it encompasses, in addition to art and literature, lifestyles, ways of living together, value systems, traditions and beliefs.” The most compact definition, however, is given by cross-cultural guru Geert Hofstede, which nicely fits Silicon Valley's core business: “Culture is software of the mind (…) the collective programming of the mind which distinguishes the members of one group or category of people from another.” Hofstede positions different national cultures on the following six basic dimensions: power distance, uncertainty avoidance, individualism vs. collectivism, masculinity vs. femininity, long-term vs. short-term orientation, and indulgence vs. self-constraint. These cultural dimensions are directly or indirectly related to entrepreneurship, and values associated with starting new ventures. Hofstede's data show that in comparing American and Dutch culture, Americans and Dutch are quite similar in terms of their attitudes towards power distance, uncertainty avoidance, and indulgence. Though both countries are western and therefore individualistic, Americans are more firmly so. The Dutch are more supportive of long term orientations. The biggest difference between the two countries is that Americans are quite masculine, whereas the Dutch are strongly feminine. Masculinity is characterized by the need for (material) success (live to work), competition and a strong role differentiation between men and women.