Assessing Cultural Orientation as a Reflective- Formative Second Order Construct-A Recent PLS-SEM Approach

It is strongly believed that Hofstede’s cultural dimensions do have a significant influence on the behaviours of individuals. The existing studies have mostly examined the five dimensions of Hofstede’s cultural framework including power distance, long term versus short term orientation, masculinity versus femininity, uncertainty avoidance, and individualism versus collectivism. However, there is a dearth of empirical studies investigating indulgence versus restraint as the sixth dimension under the Malaysian context. Thus, to fill this research gap, this study was conducted among Malaysian entrepreneurs to examine the significance of all six dimensions of Hofstede’s cultural framework under the context of Malaysia. The data was collected using snowball and quota sampling techniques from 450 Malaysian entrepreneurs of wholesale and retail SMEs. SPSS version 20 and Smart-PLS software were used for the descriptive and inferential data analysis respectively. Moreover, the construct of cultural orientation was treated as reflective-formative second order construct and the latest approach proposed by Hair et al. (2017) was used to analyse this construct. The findings of this study have provided the empirical evidence regarding the significance of all six Hofstede’s cultural dimensions as the formative indicators of the construct cultural orientations that has been considered as the reflective-formative second order construct in this study. The study limitations, future recommendations, and conclusions are presented at the end.