Power distance is the extent to which the lower ranking individuals of a society “accept and expect that power is distributed unequally”.
It is primarily used in psychological and sociological studies on societal management of inequalities between individuals, and individual’s perceptions of that management.

In simple term, Power-Distance is a degree to which people in a particular society feel power is distributed unequally.

This type of a study usually helps in understanding the human psychology where in the people feel that the rich are more powerful as compared to the poor people in the society.

Societies like India where there is high power distance, means people assume decision by higher authorities as granted and does not ask more explanations to justify equality.

Whereas in some of the western countries higher authorities are required to give explanation for the decision they take.

High Power Distance:

Societies with high power distance, people in lower or non-authoritative position assumes decision taken by their authorities without questioning the authority. In these societies, vertical hierarchies are accepted. All important decision are supposed to be taken by authorities and implemented by sub-ordinates.

Hence sub-ordinates are dependent on person in authority.

Low Power Distance:

In such societies, sub-ordinates can easily disagree with their boss and still have fruitful discussion. In fact leaders expect sub-ordinates to be part of decision making process.

This kind of relationship is interdependent and complements each other.

These thing seems fine when people work in culture in which they grown up. But actual issues start when people make transfers from one culture to other culture.

1. Sub-ordinate move to high power distance culture:

In such case, sub ordinate has to be careful while giving his suggestion to his manager. Suggestion may not be taken in constructive way but treated as obstruction to follow orders.

2. Sub-ordinate moving to low power distance culture:

Here if sub ordinate only follows order then it might take as being incompetent for performing duties.

3. Moving as a manager to high power distance culture

Here if manager asks for constructive suggestions from his team then it might be taken as manager not competent enough to handle his responsibilities.

4. Moving as manager to low power distance culture:

Team may not follow the decision taken by manager but will give constructive feedback and will tend to challenge decisions.

Source: wiki & MBAskoool