Culture in International Business - EconPedia

Introduction

Culture refers to patterns of behaviour, attitudes and beliefs that are common to a group of people who commonly share these attributes and who use them for their identity. There is a diversity of cultures across the world and each culture has its own specific patterns of living.

Culture is defined as the arts, beliefs, customs, institutions, and other products of human work and thought considered as a unit, especially with regard to a particular time or social group: Japanese culture. The arts, beliefs, and other products are considered with respect to a particular subject or mode of expression: musical culture; oral culture.

Culture is also described as the set of predominating attitudes and behaviour that characterise a group or organisation: a manager who changed the corporate culture [1].

Apart from definitions of culture, the forthcoming chapters provide an insight into cultural influences on managers in international business. So far the economic issues were highlighted but an essential one remains the cultural aspect. In a globalised world, managers are in contact with their counterparts in other geographical locations. Companies have businesses in more than a single country. These conditions entail a deeper understanding of cultural variations. Taking for granted that cultural differences are internal and do not materially affect the activities of a multinational would be erroneous. Companies start believing that the world is a global village and that adaptation to the needs of local markets remains important. This is where the jargon ‘glocal’ arises where it means think global act local.

Understanding and respecting a foreign culture is a necessity for managers. Very often, there might be religious or socio-cultural factors that are contrasting between one country and the other one. Religious patterns vary, social values might differ apart from administration or bureaucracy that might also be embedded in a country’s broader culture. Emerging economies are usually highly prospected by western companies since they have been unexploited earlier or might, by now, have attained a higher level of economic development to become a potential market. Multinationals will be eager to enter markets like Russia, India or China but they must make adjustments to such environments as customers are not enough familiar to understanding and consuming new products. There might be ingredients that might not religiously satisfy a different country. Some emerging nations might have a community that is largely vegetarian and consumes less meat. Some others might stick to ‘halaal’ food.

It is also useful to note that cultural variations do not expressly mean that one culture is superior to another one. This is simply a dumb and unfounded statements. The fact that a business manager is unaware or not conversant with another culture might also be a source of cultural misunderstanding. This can create the risk for a business to fail abroad if it does not comply by local regulation’s in force. Additionally, there might be the consequence of cultural divide and related problems like lack of tolerance, blasphemy, etc. when local mores are not clearly understood and respected. In this respect, it becomes an imperative for business managers to learn about cultural variations, similarities, the level of homogeneity and heterogeneity, prior to embarking on foreign business. These aspects, once properly mastered, allow organisations to have a better entry possibility in an emerging market and make the best of business both regionally and internationally.

The pervasive aspect of culture

Culture is all pervasive. In other words, it can affect people at various stages and instances of life. In the past, each country had its own culture and patterns of behaviour. With the development of the media and technology, culture evolves much more rapidly from one place to another one and creates impact in various societies. ‘Culture appears to have become key in our interconnected world, which is made up of so many ethnically diverse societies, but also riddled by conflicts associated with religion, ethnicity, ethical beliefs, and, essentially, the elements which make up culture,’ De Rossi said [2]. ‘But culture is no longer fixed, if it ever was. It is essentially fluid and constantly in motion.’ This makes it so that it is difficult to define any culture in only one way. Nowadays, in every corner of the world, people wear the American jeans despite the fact that it is not their dressing style. The consumption culture has had its impact in many places across the world. People drink Coca-Cola as they view it as their favourite Cola drink, the young people stroll around carrying a Walkman, etc.

Artefacts are contained within cultures. Artefacts are the physical things that are found that have particular symbolism for a culture. Artefacts can also be more everyday objects. They main thing is that they have special meaning, at the very least for the people in the culture. There may well be stories told about them. The purpose of artefacts are as reminders and triggers. When people in the culture see them, they think about their meaning and hence are reminded of their identity as a member of the culture, and, by association, of the rules of the culture. Artefacts may also be used in specific rituals. Churches do this, of course. But so also do organisations [3].

Visible artefacts

These can be the way people dress, tools, equipment, icons, and other physical materials that they use. For example, the presence of statues which are worshipped by people in oriental cultures, gives us an impression of the value and importance of visible artefacts.

Invisible artefacts

These refer to patterns of behaviour that cannot be easily seen or understood. They are beliefs that have been transmitted through the ages and are unconditionally accepted by the new generation. For example, uttering the word ‘Namaskar’ or nodding the head either show approval or disapproval are evidences of invisible artefacts, that is things that cannot be easily interpreted yet they have an implication.

Culture is supported by religion and dogma

Culture is sustained by religion and dogma. This is true because religion still makes people fearful about God and obliges them to follow culture. This is more evident in oriental cultures where people participate with fervour in many festivals, perform rituals and sacrifices and follow the spiritual path which they believe brings them to the path of salvation. Albert Einstein stated that ‘The religion of the future will be a cosmic religion. It will have to transcend a personal god and avoid dogma and theology. Encompassing both the natural and the spiritual, it will have to be based on a sense of intelligence arising from the spirit of all things, natural and spiritual, considered as a meaningful unity [4].’

Subcultures

Subcultures are cultural groups that come from mainstream cultures. It is believed that the main reason underlying the existence of sub-cultures is that the main culture has been unable to cater for all sections of the community which follows the broad cultural patterns and backgrounds. Subcultures have less formality and splendour than major cultures. Many subcultures are hence unofficial and they look rather for a little group of people who look for satisfaction within it. For example, people who were born after the second World War were considered as ‘baby boomers’, people who remain in their house once they are way from work have been considered as ‘cocooners’. Subcultures, because of their informality, can be numerous and have their own set of values, beliefs and customs.

Drawing from Marxist theorists, literary critics, French structuralists, and American sociologists, subcultures was an initial study of Hebdige who presented a model for analysing youth subcultures. The scholar argued that each subculture experienced the same trajectory, while he outlined the individual style differences of specific subcultures, such as Teddy boys or skinheads and punks. Hebdige emphasised the historical, class, race, and socioeconomic conditions that surrounded the formation of each subculture [5].

Examples of subcultures

The Hispanic subculture in the USA—One urban subculture heavily related to Mexico, and parts of the U.S. which have high levels of Mexican immigration, is that of the cholo. Popular culture regularly depicts the cholo as either a baggy pant and XL shirt wearing man with a penchant for bandanas, or as a hoop-earring wearing, overly lip-lined woman, and many would agree that that’s their ‘look’ [6].

The Harley Davidson Subculture—Youngsters who are rich, trendy and drive the big HD motorcycle. For example, black leather vest in the company of insignias that serves as the identical uniform for members of the Harley Davidson subculture bears a striking semblance in the form and the function to prohibited colours which only tend to inspire some radicalism into the bikers [7].

But the most straightforward, prosaic theory is that, as with virtually every area of popular culture, it’s been radically altered by the advent of the internet: that we now live in a world where teenagers are more interested in constructing an identity online than they are in making an outward show of their allegiances and interests. It is hard not to be struck by the sensation that, emos and metalheads aside, what you might call the 20th-century idea of a youth subculture is now just outmoded. The internet doesn’t spawn mass movements, bonded together by a shared taste in music, fashion and ownership of subcultural capital: it spawns brief, microcosmic ones [8].

Importance of Culture to International Businessmen

Culture is a very important aspect that businessmen will have to consider especially when they are concerned with international business activities. When, the businessman goes on board of an aeroplane, he starts feeling that he is alienated from the ties he has with his native land. In fact, when he enters a foreign country, he must get accustomed to the mode of living in that country, or the prevailing culture in the country.

Communication is important in international business

Businesses are selling products around the world. Partnerships are being formed with people from diverse cultures as business relationships are formed. Each country and the cultures within a country bring communication challenges to businesses. Good international business communication practices help maintain these intricate business dealings. Bad communication practices can cause loss of business and even international tension among countries. Communication is intricately blended with non-verbal communication and etiquette [9].

Because cultures vary so widely across the globe, understanding the differences in culture and the importance of international communication is vital to the business environment. A person’s culture impacts the way he communicates. For example, in Japan people do not like to say the word ‘no’. In a business meeting, a Japanese business person may mean no, but never directly state it. This can cause confusion.

Another cultural example is in Saudi Arabia. Never discuss women, even to ask about a female family member’s health. In Saudi Arabia, you may be having a business meeting and the person may leave the room for up to 20 minutes. The Saudi person may have gone to prayers as he considers the business meeting more of a discussion than a formal meeting.

Good international business communication practices help maintain these intricate business dealings whereas bad communication practices can cause loss of business and even international tension among countries. Cultures vary so widely across the globe, understanding the differences in culture and the importance of international communication is vital to the business environment.