**5. Role of culture in managerial decision-making**

Clarity in managerial decision-making mechanisms is often credited to hierarchy. This concept started with Max Weber's administrative management theory (Weber, 1947). But clarity in lines of authority should serve another purpose; gravitating towards those who have the most relevant knowledge about the managerial or technical problem at hand. We coin this concept as knowledge-based role distribution. Although seemingly simple, it is not easy to apply. In most organizations, and in most national cultures, personal or prior social relationships, informal networks of friends and family, are a few examples of how appointments are made in many high level positions (McDermott and O'Dell, 2001). These appointments are often followed by exchange of favors. It is believed that such factors exist in many regional or national cultures and several models have been developed to account for power distance and its effect on behaviors in society and in business dealings (Hofstede, 1985). Hofstede (1985) uses five dimensions to describe the extent to which power differentials within society and organizations are accepted. More recent studies established some level of relationship between power distance, societal traditions, and personal value systems and beliefs (Basabe and Ros, 2005). Nevertheless, many studies have shown that the positive role of knowledge-sharing in employee growth and organizational performance transcends national boundaries and societal norms, is driven by globalization trends, and is influenced by a global convergence in the use of quality and business standards (Chalhoub, 2009). We propose that, for multinational organizations, knowledge creation and sharing be the prerequisite for business performance, while we maintain that these other relational factors – local societal traditions and national cultures – would certainly be important checkpoints.

The role of culture becomes even more important in fostering the use of objective and factual decision-making processes. It becomes a matter of culture and conviction to let problem-solving gravitate toward those best equipped with relevant knowledge (Hatch and Schultz, 1997). It is culture that presents knowledgeable people as an opportunity to the business owner or senior manager, and not as a threat. This approach provides access to different realms of ideas, different groups of people, and offers different opportunities for utilizing resources for the competitiveness of the firm. It was argued that culture makes a great difference as to how knowledge management initiatives evolve within the organization ranging on a spectrum of a simple repository of information all the way to a highly collaborative system among employees and across organizational boundaries including e-communities of practice (Leidner et al., 2006).
