An analysis of the cultural influence on international businesses

According to a May Accenture study, optimizing this process through training can increase productivity by 30 percent.

What is possible is developing the mindset of a globalist — or, in other words, mastering cross-cultural core competency. If I demonstrate to you, instead, how uncomfortable you feel when I say hello and proceed to shake your hand while standing 6 inches from your face, I have accomplished the equivalent of teaching you to fish.

Communication An understanding of the subtle challenges in the use of English with non-native speakers, as well as the nuances of non-verbal communication, is critical to achieving business objectives when operating across cultures. Some of the most significant challenges are often IT-related.

You now know that every culture has a specific, acceptable space proximity. Time Orientation The concept of time orientation refers to the way in which a society values, executes and utilizes time.

The total disconnect causes a loss of business opportunity, or alternatively, leaves dollars on the table as the exhausted Westerner, unprepared for the duration of the exchange, makes price concessions way too early.

The most striking difference between China and Western cultures in this regard is the long-term orientation of the Chinese culture. An understanding of group dynamics in the target culture significantly impacts the sales process.

While the decision-maker may appear to be at the negotiation table because that individual is the chairman of the company, the shots may be being called by individuals not present father, grandfather or uncle, for example.

Cross-cultural differences have time and time again been identified as the most significant impediment to successful international ventures and projects.

The domestic companies that are likely to see incremental growth in the coming decades are those that are not only doing business internationally, but that are developing the strategic skill set to master doing business across cultures. The HQ platform might have the capability to generate the report with the specific information and format requested in a blink of an eye or at least the click of a mousebut a satellite office in Senegal might require a programmer or a wiz with an excel spreadsheet over the course of a week to effectuate the same result.

If I tell you that when you engage in a sales call in the United States, the acceptable spatial proximity between you and your prospect is 2. My own definition is that culture is our collective experience as a society, and its impact on our reaction and decision-making relative to every-day facts and circumstances.

The longevity of the culture combined with Confucian philosophy yields a long-term orientation that materializes in the business world in several ways. Denise Pirrotti Hummel, J. The next time you get off the plane anywhere in the world, you will look around and observe how far apart people are standing, log that information somewhere in your busy brain, and proceed to your next meeting armed with information that will avoid instant discomfort and a potential disconnect that may jeopardize business with your international counterpart.

A Framework for Understanding Culture has many definitions. Now imagine if you could augment this simplistic metaphor incrementally, to every aspect in which culture impacts business.

Understanding the Importance of Culture in Global Business

Where technological practicality or the realities of budget do not permit complete integration, that disconnect must be evaluated and corrected. Let us examine some examples of American executives interacting with Chinese executives to illustrate how a few of these comprehension lenses impact business.

Short-term wastefulness in a supply chain, for example, is despised because thrift is a significant virtue, but professional development training that will lead to long-term corporate growth may see lavish expenditures. Business planning is not quarterly or annual, but often is anticipated for the next decade, or even decades.

These obstacles can be transformed into opportunities with a framework for tackling them head-on. Leveraging the Power of Culture While the U.

In East Asian cultures, communication is very subtle and indirect. In Western cultures, time is a commodity. The culture has survived for thousands of years, through flood and famine and having been invaded on all sides by multiple forces. The Confucian value of endurance has a profound impact on the business process.

Time is divided into the sixty minutes of a standard clock. The list of fast-growing emerging markets goes on and on. In China, a highly collectivist culture, the marketing collateral and sales process needs to be targeted toward the group, and not toward the individual.

The difference is that a multinational company simply operates in multiple nations; a global company has embarked upon the journey of systematically updating its policies, procedures, and systems across multiple cultures.

Thus, the direct style of Western communication can easily create serious offense, despite the best of intentions. It is possible, however, to incorporate a cross-cultural framework that improves cross-cultural understanding and interactions. Knowing means that reasonable expectations for the deliverable can be set.

Typical examples include requests from finance in HQ in the United States requesting financial reports from satellite offices around the world. After only two years in operation, they ran out of cash and had to borrow million dollars to keep operating.Understanding the Importance of Culture in Global Business when the underlying cultural motivation of the international customer is almost completely focused on customer service, the value proposition consists of selling ice in the wintertime — there’s plenty of it, and it was never wanted to begin with.

a cross cultural advisory. Analysis of impact of culture on international businesses is made in the following text in order ascertain the level of cultural understanding manager should possess in order to perform successfully.

Published: Mon, 5 Dec How does culture influence international business. As a result of the globalization, the increasingly close interaction between firms which are from different cultures has been booming.

Cultural Influence on International Businesses Running head: Cultural Influence on International Businesses Touro University International Wendell K. Speegle MGT Module One: The Nature of Organizations and the Contemporary Environment Dr.

Donna DiMatteo Studying consumer habits is one of the steps in marketing search and analysis. Journal of Management and Marketing Research An analysis of cultural, Page 1 An analysis of cultural impact on international business performance via.

Social factors affecting business include buying habits, education level, and religion. You will also have to look into the cultural changes which take place in your business environment.

Market research is a critical part of this step. I have added some examples of how renowned companies use the analysis.

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An analysis of the cultural influence on international businesses
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