Short or long-term plans: what’s best for 2024?

It’s that time of the year when we dedicate some time or should dedicate some time to defining the new year’s resolutions or overall objectives we want to focus on for the new year. Today, I’m looking at how different cultures tend to go the more “long-term orientation” way or the “short-term orientation” path. This refers to whether one rather goes by a more pragmatic future-oriented perspective or a conventional historic point of view.

This Intercultural dimension, based on Hofstead’s studies, describes how societies focus on maintaining links with their own past while dealing with the challenges of the present and future, and those societies that prioritize these two existential goals differently. Short-term orientation cultures, which score low on this dimension, prefer to maintain time-honored traditions and norms while viewing societal change with suspicion. Those with a culture which scores high on this dimension, on the other hand, take a more pragmatic approach; they encourage savings and efforts in modern education to prepare for the future.

Long Term vs Short Term Orientation in Planning

In a short-term orientation culture, planning processes prioritize respect for tradition, preservation of “face,” and personal stability. This involves a focus on established practices, maintaining a positive reputation, ensuring personal well-being, and adapting plans to the current context. Plans tend to be result-oriented, emphasizing immediate goals and flexibility to address present challenges. While these are generalizations, recognizing these cultural values can enhance effective communication and collaboration in planning processes.

In a long-term orientation culture, planning processes are characterized by a strategic, forward-looking perspective. Decision-makers emphasize perseverance, thrift, and hierarchical relationship-building. Financial considerations, succession planning, and adaptability to change are integral to the planning process. There is a commitment to research and development, even in challenging times, and a cautious approach to decision-making, considering the enduring impact of plans. Understanding and respecting these cultural values is essential for effective collaboration and communication in planning processes within long-term orientation cultures.

Cultural Examples of Long-term vs Short-term Orientation

• North American and Western and Eastern Europe, demonstrate a pragmatic cultural orientation. In the United States (score 50), there is no dominant preference, with Americans displaying an analytical approach to new information while maintaining a practical “can-do” mentality. Canada’s and Russia (score 54 and 47) and Europe’s France and Spain (score s60 and 58) are slightly more pragmatic, emphasizing adaptability to changing conditions, strong financial habits, and perseverance in achieving goals. Italy tends to be on a slightly lower scale of the scale at 39.
• Eastern cultures, including China, Japan, and Korea, favor long-term orientation, emphasizing group cohesion and shared objectives. Pragmatic orientation prevails, valuing adaptability, thriftiness, and perseverance. Japan and South Korea score 100, embodying strong long-term orientation with a focus on virtues and practical examples. This aligns with the Japanese view of life as fleeting, promoting a commitment to doing one’s best within one’s lifetime. China, scoring 77, also exhibits a highly pragmatic culture.
• Latin American countries like Mexico, Argentina, and Brazil hold a more short-term orientation. The relatively low scores of 6, 12, 23, 28, 28, 29 and 29, mean that Colombian, Chilean, Mexican, Brazilian, Uruguayan, Argentinean, and Ecuador cultures, are respectively normative. People in such societies have a strong concern with establishing an absolute Truth; they are normative in their thinking. They exhibit great respect for traditions, a relatively small propensity to save for the future, and focus on achieving quick results.

Long-term and Short-term Orientation in Business

• American and Canadian businesses measure their performance on a shorter-term basis, with profit and loss statements being issued every quarter, driving individuals to strive for quick results within the workplace. Both western and eastern Europe companies also show this tendency. A propensity for savings and investment can also be reflected in these businesses.
• This tendency to quick results in businesses are seen even more heavily in Latin-American cultures.
• From a corporate point of view, long-term oriented cultures translate to the overarching principle is the longevity of companies, emphasizing service to stakeholders and society across generations. In Japan and Korea, a similar commitment to long-term values is reflected in consistent high investments in R&D, maintaining a higher own capital rate, and prioritizing sustained market share growth. The philosophy underscores that companies exist not merely for quarterly profits but to serve stakeholders and society for many generations.

Long-term and Short-term Orientation in Leadership Styles

The cultural dimension of short-term versus long-term orientation has notable effects on leadership styles and approaches.

• Short-term immediate results and outcomes. Leaders may focus on achieving quick wins and addressing pressing challenges. Leaders may make decisions with a focus on the present context, responding to immediate needs and opportunities. There’s an inclination toward flexibility and adaptability, allowing leaders to respond swiftly to changing circumstances. Leaders may be more open to taking risks and adopting innovative strategies to achieve short-term goals.
• Long-term orientation cultures emphasize a strategic, visionary approach. Leaders focus on setting goals with enduring impacts and consider the long-term consequences of their decisions. Leaders demonstrate perseverance and resilience, understanding that achieving significant goals may require sustained effort over an extended period. Leadership in these type of cultures often involves careful consideration of hierarchy and relationship-building. Leaders often prioritize the development and grooming of future leaders. Long-term cultures value meticulous planning and sustainable practices. Leaders consider more permanent implications of their decisions on the organization’s legacy and stability.

Challenges and Solutions

• Leaders should possess intercultural understanding of short-term and long-term orientation for effective decision-making, communication, and collaboration. This awareness enables leaders to tailor strategic plans, motivation strategies, and leadership styles to align with diverse cultural preferences. It contributes to building trust, resolving conflicts, and promoting organizational agility in a globalized context. Ultimately, leaders with intercultural competence foster inclusive, adaptable, and culturally intelligent leadership, positively impacting team dynamics and organizational performance.
• As Intercultural Executive Coaches we act as trusted guides, aiding business leaders in comprehending the variances between individualism and collectivism. They provide practical skills and strategies. An Executive Coach can accompany you through the up and downs, and the challenges of a good Strategic management, when planning and executing complex projects while collaborating with others. We can support you while you establish clear and achievable goals, ensuring their alignment with your long term personal and professional higher goals or organizational objectives set up for you.  Do you have your overall roadmap for continuous improvement and success?

Complementing this article, in last year’s blog, I shared some tips on how to build yourself a set of smart (or S.M.A.R.T.) goals that you’re more likely to follow through with. Take a look, it might help you make more plausible and realistic plans.