MBD-2 2/2 Discussion

a) The concept of Power Distance is quite intriguing in nature. High power distance cultures tend to have an obedient attitude towards authority due to the burgeoning income equality. Authoritative figures in high power distance cultures have quite lavish lifestyles while the rest of the population suffers in silence. In contrast, low power distance cultures have a more decentralized political system where authorities are more impartial in nature. In these societies, the attitude towards authoritative figures is not as obedient and there is a system that revolves around meritocracy.

b) Daniel and Greguras (2014) state that understanding power distance is especially important in organizational research because power is fundamental to all relationships, is inherent in hierarchical organizations, and affects many organizational processes and outcomes. The organization that I have been involved with recently is Goldman Sachs which is a renowned investment bank in the US. The power distance dimension based on my observation is a little on the higher side. The reason for my conclusion is based on how promotion of an employee works. During the promotional cycles, employees are reviewed by their fellow peers which means there is a bit of democracy involved however, the ultimate decision lies in the hands of the manager or the authority that has the power to revoke any decision. 

c) Naresh Khatri (2009) states that in high power distance organizations, there is hardly any horizontal communication and information is generally passed down vertically (Khatri, 2009).The concept of power distance is quite evident at Goldman Sachs. The senior management at the investment bank makes all the strategic decisions for the firm and employees are not that willing to participate. 

Bibliography:

Daniels, M. A., & Greguras, G. J. (2014). Exploring the Nature of Power Distance: Implications for Micro- and Macro-Level Theories, Processes, and Outcomes. Journal of Management, 40(5), 1202–1229.  https://doi.org/10.1177/0149206314527131

Khatri, N. (2009). Consequences of Power Distance Orientation in Organisations. Vision, 13(1), 1–9.  https://doi.org/10.1177/097226290901300101