Understanding Cultural Differences in International Business
Identification of Culture-Specific Preferences in International Business Context and Development of Suitable Rapport Management Strategies
International business not only deals with cross borders but also across cultures. Culture seems to deeply influence how people communicate, behave or think. It also impacts the type of transactions they seem to make and how they negotiate. To be successful international managers must be able to adapt and interpret the different cultures. Managers must also have good negotiation and communicative skills, along with an in-depth knowledge of the culture where they seem to be working. In other words, they must develop competencies and skills. As put forward by Hoftstede (1995), short term or task-oriented Anglo-Saxon or American approaches to the business might effectively work across California but might fail across France and remain counterproductive across Japan.
According to Morden (1995), the differences in culture also takes into concern values, deeper beliefs and custom that are difficult to identify. It is thus necessary for the managers to understand the cultural differences and dimensions since managers must understand the employees to motivate and lead them. In this regard, a Dutch-based management scholar, Geert Hofstede, undertook a multicountry and multiyear study for identifying the ways of describing the differences in the national cultures. The research was undertaken considering over 10,000 employees from across 40 countries. Later on, a project on Global Leadership and Organizational Behavior Effectiveness (GLOBE) was conducted with close to 170,000 managers across 162 countries (Castillo-Palacio, Batista-Canino and Zúñiga Collazos 2017). From the studies, it can be said that managers needed to be aware of culture-specific dimensions concerning the international business context to develop suitable rapport management strategies. These dimensions include power distance, avoidance of uncertainty, the performance of the orientation, assertiveness, futuristic orientation, humanistic orientation, institutional collectivism, in-group collectivism and gender egalitarianism. It is described in detail in the following paragraphs.
- Power Distance:It refers to how people seem to accept unequal distribution of power and status privileges (Daniels and Greguras 2014). Countries with a high power distance have respect for titles and age, and people are expected to follow the rules with an increased level of tolerance for the concentrated power. Mexico, India and the Philippines have a higher power distance while countries such as Australia, the United States and Israel have a lower power distance.
- Uncertainty Avoidance: This indicates the extent to which people become uncomfortable with the change, risk as well as ambiguity (Minkov and Hofstede 2014). Countries with a higher level of uncertainty avoidance emphasise structure, rules, predictability and order. Japan, France and Costa Rica are examples of countries with a higher level of uncertainty avoidance. On the other hand, India, Sweden and the United States have a lower level of uncertainty avoidance.
- Performance Orientation:This is the extent to which excellent performance, higher standard and innovation are rewarded and encouraged (Minkov and Hofstede 2014). Countries having a higher level of performance orientation seem to value competitiveness and materials and they are generally expected for investing in the training for the promotion of performance improvement. The European countries and the United States seem to have a higher performance orientation while Russia, Greece and Argentina have a lower performance orientation.
- Assertiveness: This refers to how individuals become confrontational, aggressive and forceful compared to being compassionate and cooperative (Parham et al., 2015). Countries with a higher degree of assertiveness include Germany, the United States and Mexico, where the communication is unambiguous and direct. These countries seem to encourage individual initiative, and the relationships happen to be competitive. On the other hand, countries with a lower assertiveness are New Zealand and Switzerland. Managers of these countries look towards cooperative decision making and consensus.
- Futuristic Orientation:The extent to which the delayed planning and gratification for the future seems to be valued over the gains of the short -term (Siddiqi and Shafiq 2017). Countries having a higher level of future orientation seems to encourage investment for the future payoff over the immediate consumption. Countries such as Switzerland, Malaysia and Canada have a higher level of future orientation while Argentina, Poland and Russia have a lower level of future orientation.
- Humanistic Orientation: The extent to which altruism, generosity and kindness seem to be valued and encourage acts as the humanistic orientation of a country (Anufrieva et al. 2020). Nations having a higher level of human orientation have responsible individuals for the promotion of the well being of the others compared to nations providing economic and social support. Ireland, Egypt and the Philippines have a higher degree of human orientation, whereas Singapore, Germany and France have a lower level of human orientation.
- Institutional Collectivism:Institutional collectivism refers to how the societal and organisational institutions encourage individuals to remain integrated into organisations and groups (Raimo, Zito and Caragnano 2019). In countries with a higher degree of collectivism, collective action and collective distribution of resources seem to be encouraged. Here group loyalty seems to be encouraged although it undermines the pursuit of the individual goal. Singapore, Japan and Sweden are countries with a higher level of institutional collectivism. On the other hand, Germany, Italy and Argentina have lower levels of institutional collectivism. The lower levels of institutional collectivism across the United States have resulted in the debates associated with a suitable work and life balance.
- In-Group Collectivism: This reflects how individuals express pride, cohesiveness, loyalty in the family or the organisation (Pathak and Muralidharan 2016). In a country with a higher level of institutional collectivism, individuals seem to identify with the organisation or family and undertake obligations and duties that determine behaviour. A stronger distinction is drawn between the individuals who seem to be in a group and those who do not seem to be part of it. China, Egypt and India happen to be examples of the countries having a higher level of institutional collectivism. On the other hand, Finland, Sweden and New Zealand have a lower level of collectivism.
- Gender Egalitarianism: This refers to how female and male equality gets actualised. Countries having a higher degree of gender egalitarianism put across opportunities enhanced opportunities for women and thus have increased the number of women in powerful positions (Lyness and Judiesch 2014). Poland, Sweden and Costa Rica have higher levels of egalitarianism while Italy, Egypt and Japan seem to have lower levels of gender These are the countries where the women seem to have lower status at their work or within the culture.
When firms decide to internationally expand, they need to be aware of the cultural differences. To increase the effectiveness, managers require to be familiar with the cultural surroundings. Various kinds of advertising include phrases or images considered culturally offensive. For instance, Pepsi lost its overriding market share to Coca Cola in South East Asia when it changed the colour of the vending machine to a lighter shade of Ice Blue. Such an instance occurred since the company did not understand that the shade of blue that it changed into remained associated with mourning and death within the concerned region.
In an International business where culture seems to play a dominant role, managers need to consider the different communication processes. Different cultures also have different practices of communication. In certain countries, direct feedback is unacceptable, and the managers must be able to understand the subtle body language for determining if a receiver accepted or understood the message. For instance, there are cultures where a superior consider it disrespectful when he is pointed out for his mistake by his juniors. Again some cultures seem to have varied ideas about the time. For instance, in the United States, appointment refers to the time when a person is anticipated to arrive, while in other countries, an appointment refers to the earliest when an expected person can arrive; however, he has the option to arrive later. Global managers need to accommodate and appreciate cultural differences.
Johnstone, Lustig and Koester (2003) suggest the cultural differences in impression management and the ethical considerations. They happen to provide an insight into how cultures vary in persuading one another in arguments or discussions. This variation in the persuasive style or the impression management can be described with the help of three strategies:
Quasilogic:This refers to the preferred style in Western cultures. It is evidence-based and uses objectivity through testimony and statistics from the experts. The evidence is accepted as true when the argument logically leads to the conclusion. This strategy moves from the generalisations to the specific examples. This strategy helps in creating links between the key topics and the subtopics. People seem to be persuaded by statistics, facts and illustrations. In other words, it makes use of logical connectives with persuasive ideas. They also seem to admire original thinking supported by expert data or opinion.
- Presentational:According to this strategy, relationships and people seem to take precedence over the facts. The idea does not seem to be persuasive but the way it is presented to others seems to be more important. Language happens to be the persuasion tool and is often in the form of hyperbole or poetry. This strategy helps in creating an emotional response to the listener and seems to be filled with the sensory words inducing the listener to see, look, fear as well as believe.
- Analogical:This strategy is linked to the storytelling and can be linked to the historical precedent or past for informing the present. It involves choosing a suitable story or the historical moment for portraying the spirit of the message. This strategy seems to persuade the audience into the course of the action.
References:
Anufrieva, N.I., Volkov, L.V., Aralova, E.V., Kolomyts, O.G. and Myagkova, E.V., 2020. Environmental education: Nurturing of the humanistic orientation of a personality. Universal Journal of Educational Research, 8(11), 5529-5535.
Castillo-Palacio, M., Batista-Canino, R.M. and Zúñiga Collazos, A., 2017. The relationship between culture and entrepreneurship: from cultural dimensions of GLOBE project. Espacios.
Daniels, M.A. and Greguras, G.J., 2014. Exploring the nature of power distance: Implications for micro-and macro-level theories, processes, and outcomes. Journal of Management, 40(5), pp.1202-1229.
Hofstede G, (2005). Cultures and Organisations: Software of the Mind, London, McGraw-Hill
Johnstone, B. in Lustig, M. W. and Koester,J. (2003) Intercultural Competence, interpersonal communication across cultures, 4th Ed. Boston, Allyn and Bacon P 250
Lyness, K.S. and Judiesch, M.K., 2014. Gender egalitarianism and work-life balance for managers: Multisource perspectives in 36 countries. Applied Psychology, 63(1), pp.96-129.
Minkov, M. and Hofstede, G., 2014. A replication of Hofstede’s uncertainty avoidance dimension across nationally representative samples from Europe. International Journal of Cross-Cultural Management, 14(2), pp.161-171.
Morden T, 1995 International Culture and Management in Management Decision 95, Vol.33 Issue 2, p16
Parham, J.B., Lewis, C.C., Fretwell, C.E., Irwin, J.G. and Schrimsher, M.R., 2015. Influences on assertiveness: Gender, national culture, and ethnicity. Journal of Management Development.
Pathak, S. and Muralidharan, E., 2016. Informal institutions and their comparative influences on social and commercial entrepreneurship: The role of in?group collectivism and interpersonal trust. Journal of Small Business Management, 54, pp.168-188.
Raimo, N., Zito, M. and Caragnano, A., 2019. Does national culture affect integrated reporting quality? A focus on GLOBE dimensions. In 9th International Symposium on Natural Resources Management, May 31st, 2019, Zajec?ar, Serbia (pp. 383-392). Belgrade: Megatrend University.
Siddiqi, N. and Shafiq, M., 2017. Cultural value orientation and gender equity: a review. Social psychology and society, 8(3), pp.31-44.
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
