The Cross-cultural Impact on International Business

learned, shared, and enduring orientation patterns in a society. People demonstrate their culture through values, ideas, attitudes, behaviors, and symbols. transmitted through the process of learning and interacting with one’s environment, rather than through the genetic process.

Why Culture Matters in International Business

Cross-cultural proficiency is paramount in many managerial tasks Problems arise in areas such as- teamwork, pay-for-performance system, union- management relationships, attitude towards ambiguity

All cultures of the world—despite many differences—face a number of common problems and share a number of common features All societies, if they are to survive, are confronted with fundamental universal needs that must be satisfied.

Economic Systems the most obvious and immediate needs of a society is to meet the basic physiological requirements of its people. Because commodities are always in finite supply, each society must develop systematic ways of producing, distributing, and consuming these essential resources.

Marriage and Family Systems One should know about these systems, especially in those areas where one is running business Important implication in labor contracts

A society must have an organized way of passing on its cultural heritage from one generation to the next. This universal societal need for cultural transmission gives rise to some form of educational system in every society. Knowledge of these is helpful for businessperson engaged in marketing strategies abroad.

Socio-control Systems Every society has a system for coercing people to obey the social rules, and these are called social control systems. In order to maintain order and good working relationships among employees, corporations operating abroad would be more successful by using local mechanisms of social control.

Religions and Other Supernatural Belief Systems Societies develop supernatural belief systems for explaining these unexplainable occurrences. Religions and other supernatural belief systems affect the conduct of business by shaping attitudes about work, savings, consumption, efficiency, and individual responsibility.

National, Professional and Corporate Culture

Research suggests that employees are socialized into three cultures: national culture, professional culture, and corporate culture Working effectively within these overlapping cultures is a major challenge.

Key Dimensions

There are numerous dimensions of national culture. Can be grouped into two broad categories- subjective and objective

Subjective Dimensions of Culture values and attitudes manners and customs deal versus relationship orientation perceptions of time perceptions of space religion

Objective Dimensions of Culture symbolic and material productions, such as the tools, roads, and architecture unique to a society.

Language- a Key Dimension of Culture Language is such an important dimension of culture that it requires extensive treatment. Often described as the expression or mirror of culture, language is not only essential for communications, it provides insights into culture.

Language- a Key Dimension of Culture Linguistic proficiency is a great asset in international business because it facilitates cross-cultural understanding. The same word can convey different meanings in the two countries- thus advertising themes often lose their original meaning in translation or convey unfavorable interpretations. Business jargon can also impede communication

Interpreting Culture

Metaphors Spanish Bull Fight

Medieval Jousts

French Coffeehouse

Japanese Garden

Swedish “Stuga”

Dragon

Stereotypes

Homer Simpson

Arab= terrorist

African Americans good at sports

All Italians are the Mob

Idioms To roll out the red carpet Beating around the bush Barking up the wrong tree “no está el horno para bolos”

High- and Low-context Culture Clear Logical Straightforward High-context Culture Indirect Polite Sensitive Non-verbal Cues

East VS West

West East Christianity concerned with absolute moral values Buddhism and Confucianism focuses on virtue legalistic contractual relationships direct personal relationships Weak hierarchical structure Strong hierarchical structure Attribution groups are important Frame groups are important freedom and personal conscience security and obedience Individualistic orientation Group orientation Need for self-assertion Need for coordination

Cultural Change

Cultural Diffusion it is seen to be superior to what already exists it is consistent with existing cultural patterns it is easily understood it can be tested on an experimental basis its benefits are clearly visible to a relatively large number of people

Impact on Business Product design Advertisement Acceptability Strategic guidelines

Challenge of Crossing Boundaries

Communication Analyze Ethnocentric orientation

Cross-Cultural Business

Marketing

Advertisements

Pepsodent

Product Design

Washing machines in Europe and Asia

Sinks in Central and western America

Pricing

Branding

Umbro- Zyklon

Negotiations

Solutions

Develop cross-cultural skills Avoid cultural bias Language training Develop cross-cultural skills Tolerance Perceptiveness Valuing personal relationships Flexibility and adaptability