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Culture Impact On International Business Cultural Studies Essay

Culture always makes a great impact on international trade. Although there are similarities between various ethnicities, but there's also obvious differences, the ever-present different ethnical backgrounds have an impact on international trade. Different ethnic products in international trade will have name, trademarks, advertising, and verbal and written communication translation impact. Therefore, ethnical factors should be taken into account in the international trade, to avoid misunderstandings which might result in financial losses.

In international trade, social background, language and customs and other ethnical differences end up being the invisible barriers as cross-cultural communication in international trade. To analysis the distinctions of language and cultural factors and their impact, the key element to start the international market and increase International trade efficiently is applying cross-cultural exchange effectively. Many powerful companies failed in international business, the primary reason are not the scarcity of capital or technology, but credited to overlooking the cultural dissimilarities impact on trade and communication.

In the face of this, we ought to be familiar with the importance of culture, find out the areas of culture that effect on the international trade, and understand how these items work.

Relevance of Culture

The effect on international trade of ubiquitous ethnical factor is recessive and potential. Culture gets the feature of group. As the normal pattern of behavior which gathered in the history, people approve and follow their own culture they live with. Culture hybrid is the catalyst of monetary development while culture conflict is the 'cancer tumor cell' of monetary cooperation.

2. 1 Concept of Culture

Culture is how a group of men and women solves problems and reconciles dilemmas. (Alfons Trompenaars, Charles Hampden-Turner, 1993, P6) Culture is made by the ideas, ideas, behaviour, customs, practices, representatives of a group in a given period and the entire sense from this group of the many activities.

2. 2 Values of Culture

According to the importance of culture, it's important to learn the culture well. When acquiring a words and know the precision interpretation in the culture, we can communicate with others through it. By understanding the customs, we can predict how business partners and customers are likely to react. By learning the partners or customers' culture values, we can distinguish between what is considered right or incorrect, acceptable or offensive. To know different ways of thinking in different culture, we can identify with other managers, provide knowledge to meet and negotiation with them.

2. 3 Levels of Culture

As we learn from the lecture, we know there are at least three degrees of culture:

National/Regional Culture-Culture within the country/regional

Corporate Culture-Culture within a particular organization

Professional Culture-Culture of particular functions in a organization

3. 0 How exactly does culture work

As we realize, culture is a wide concept. So that it make a difference international trade in many ways both inner and external the organization.

3. 1 National/Regional Culture

Language-- Cultural difference is an essential aspect that restricts the translation of the words. Because translation involves different using concept of two different languages. Inside the translation process, if you don't know the various culture very well, this often occurs that this is is quite the opposite with the real meaning which can result in the misunderstanding.

For example, when the overall Motors Corporation enters the marketplace of Belgium, the slogan was 'Body in Belgium', however when translating the slogan into Flemish words, this is was 'corpse by Fisher'. The bizarre slogan led to humiliation and the customers' distress. Things used were the drastically slide of the sales volume until the supervision became aware of this problem.

This situation shows the significance of understanding the dialect in different culture qualifications.

Custom-- Different countries have different customs, the tradition life-style, the hobby of people, the taboo, etc. , each one of these show the culture variety of the world.

A bitter circumstance shows the consequences of disrespect of custom. Lawrence Stessin, the anthropologist, pointed this in his statement. An enterprise man from North California needed to purchase a textile machines company from Birmingham in UK to open the Western european market. Shortly after he took over the company, the manager from America want to rectify issues about the English teatime. Lawrence said, in Uk, every worker experienced the teatime of half an hour. During the time, workers can tastes some wines in the large ounce container independently preferences. The director proposed minimizing the teatime to ten minutes and union agreed. But a week later, the personnel rioted in the manufacturer. They broke the home windows, destroyed the machines and hooted the administrators. The supervisor tried out to redeem for the loss, he installed the vending machines with the low capacity cups rather than the top ounce containers. Based on the American custom, the rules requested more contribution and commitment of the employees but disrespected the neighborhood custom, the business ended in bankruptcy.

Values-- As the consequence of the difference of countries' historical development, the formation of culture differs a great deal in the long history. People likewise have different thoughts and values on the same thing. In international trade activities, people with different culture record show the obvious differences on the idea of time, decision-making and conflict management approach.

Americans have confidence in free competition and individualism. Personal courage to believe duties is a virtue in People in america' eyes and it's really the positive performance. So in a negotiation, the consultant wields the power to make his own decision within the approved scope. On the contrary, Chinese people pay great attention on collective decision-making and emphasise the team intelligence. As the proverb says, 'Two minds are much better than one'. Especially in Japan, a collective country, team pursuits are higher than everything anytime.

The difference between Asian and American values brings about different understanding for some things, which sometimes results the barriers in the trade and verbal communication.

Mode of thinking-- North american linguist Robert B Kaplan(1966) proposed the Cultural thought habits in inter-cultural education through the study of abroad students who speak different mom tongue. He is convinced that thinking is spiral Oriental while Traditional western thinking is linear in.

Once an American firm wanted to enter in the marketplace of southern China, they sent a representative to cope with the business enterprise. Also, China side wants to expand its trade. Since both edges were content with the offer, the negotiation should be favouring. However the procedure for negotiation had not been so simple. It was problem here that the various thinking way. To show humility and amiable, the Chinese language director always used some fuzzy words, like 'maybe', 'perhaps', 'whatever', etc. . All these made the American administrator doubted whether the Chinese supervisor were pure-hearted to help make the offer. So they didn't signal the agreement in China. To show the esteem to others, the Chinese language manager didn't communicate his will to deal. After going back to America, the administrator wrote a notice to China and straight point out that he wished to cooperate with China. The China are pleased to accept and wrote back. However in the long letter, he put the main element point in the end with the long-winded matting before. At last there was no transaction as a result of misunderstanding which resulted from different function of thinking.

3. 2 Corporate Culture

The romance between staff-Tom Peters, American writer on business management methods, said that really the only resource to the venture is individual. Therefore, the harmonious atmosphere among staff is quite important to the development of enterprise.

It is quite normal for a transnational business to hire gifted people. While unseemly ways of arranging employees resulted in a series of problem in an enterprise. Somewhat, the appearance of these people causes internal staff staff psychological confrontation. That is an activity of coordination and modification. But the administration overlooked this serious point and simply paid more attention to these talented folks. During this period, the spirit and morale of the old personnel were affected. They became less loyal and negative and led to the drop in performance.

Another situation will lead to the discord among employees. As a Chinese, we are being used to it while which may offend people in other countries. Assume there are three employees, A, B and C. WHENEVER A and B are discussing something, C comes and interrupts their dialog or joins their speaking. It is normal in China and folks can acknowledge. In traditional western, however, people think these were not reputed or even offended. They can't accept this behaviour. So if this situation happens within an business with employees from different countries, the harmonious atmosphere will be destroyed and lead to the performance.

The romantic relationship between higher and lower levels-the marriage between employer and employee is relationship and help one another forward.

In the Chinese and Traditional western culture, this romance shows some difference:

Role difference-In China, the mainstream of Chinese language culture emphasizes the group and public prices. People pay more attention on the affiliation between individual and group. The actions and observation must be in compliance with the expectation of group.

In contrast, western people emphasize individual rights and self-reliance. For example, to respect people's rights and liberty, the loudspeaker always uses the phrasing like 'Would you?' 'Could you. ?' 'Shall I?' etc. Regardless of how the romantic relationship is between two people.

This different position of role contributes to the misunderstanding between boss and worker from different culture record.

Daily conversation-Because of the difference of different culture, a polite term in one culture may be looked at as the impolite, inappropriate vocabulary in another culture.

In China, people used to show the respect and then eldership or more authorities. Among the list of european people, they always call each other's first name, whether you are my eldership or supervisor or teacher. Instead of being impolite, they think it's the way to show intimate among people.

For example, in a transnational organization, the director is a Chinese language and the employee is a British. The manager will assign a task to the employee without what like 'please' 'thank you' which may depresses the employee in some extent. The opposite situation, if the administrator is a american people as the staff is a Chinese. It's normal when the director call the name of the employee. As the junior worker, Chinese language people always say 'it's too later, you'd easier to go home' or something like that showing concerning. But the supervisor may feel being interfered because a chance to go home is his own right.

Nonverbal communication-during the discussion, not only the express are different, but also the space distance in different culture record. In UK, people divided the distance into four types: personal distance, personal distance, public distance, general population distance. In France, people will hug and kiss the facial skin. While in China, there is absolutely no definite distance in social intercourse. The sort of body touch is shaking hands or hugging which typically happens among the same gender. Expect enthusiasts, the situation of kissing and hugging will never happen among the opposite gender. And females always go out together if they are good friends which may be misunderstood in american countries.

3. 3 Professional Culture

Within a business, both professional culture and organizational culture can condition the decisions, end result then one else in it. The organisational culture is a system that comes with an impact on the complete organization. While the professional culture lays particular emphasis on individual effort. The coexistence of the two civilizations can plan the development of organization much better.

'If the business can recruit members who've the characteristics it needs, it does not have to develop these characteristics through training and education. '(Amitai Etzioni, 1961)

If the organizational culture is fixed, the goals, the competition, the positioning are definite, the business must recruit employees with the specific characteristics. Here, the professional culture will make sense.

As a collective country, Japanese make use of own the high loyalty to their group. The unique loyalty is seen as the professional culture in a business. The 'loyalty' plays a specific and significant role in the organization. The intrinsic inspiration of the personnel' loyalty hails from the trust mechanism. Therefore, japan workers' commitment is one of the most crucial reasons that the Japanese corporate become successful.

A Chinese language business man set up a restaurant in Japan several years ago. In the first couple of years, he hired Chinese language people because they're his compatriots. In a short time, however, the employees were changed by Japanese steadily. Some guests from China want to know the reason. He informed them that Japanese are easy to control. More importantly, the Japanese employees are always regarding more about the restaurant. Once he became the personnel, he was an associate of this team. The team grew better so that the staff improved.

A director of human resource division in a Japanese transnational enterprise once said, 'as individuals, Chinese people have the excellent working ability. But as an associate of the business, they lack compatibility and sufficient responsibility'. This business recruited 20 IT employees from China. Along with the administration wished to inculcate a soul of 'loyal to firm'. But too much emphasis on this aspect sometimes resulted in their negative mentality.

There is another occurrence that we can only just see in Japan. Some Chinese language consultants had the business ventures with a Japanese publication office. They found odd that they could hardly ever see the boss himself appearing at work during the many years. All the interior things were allocated to the administrator. The employer was always residing at home by remote control. Everything was at perfect order. All of the employees did the trick hard and devote without lazing. They all treated the venture and supervisor as their family because they know better the business was, much more money they could earn.

Once a Japanese director was asked a question, 'Why not start your own business and become your own manager with your expertise?' For the reason that company, he deals with all the affairs. He can earn much more if he start his own business. But he said that he has been around the business for more than three years from a staff to a administrator. His growth can not be without working out and cultivate of the employer and enterprise. They may be a huge family. In Japan, employees are dedicated to the business. Although another company will pay more and provide better treatment, they won't change their thoughts easily.

How to evaluate an employee's commitment? When buying things for the company, the staff never acquire kickbacks; never use the business cell phone to make personal international call; to be the first one to come, the previous one to go back; meticulous, and so forth. In the eyes of Japanese staff, these exact things are unalterable. The ultimate way to show the employees' devotion is the company with their choice, or "single-mindedness. " And the boss identifies the loyal staff as "actively perform the spirit of sacrifice. "

Since the 90s from last century, Japan's bubble overall economy collapsed. The problem of employees' loyalty emerged. Japanese human resource instruction conducted a study in 2002. Among Netherlands, Mexico, USA, Germany, Italy, Japan plus some other countries, the employees' loyalty of the first three countries was 73%, 72%, 68% respectively. That of Japan was only 50%. These were stunned by the results. This end result implies that the positive influence of professional culture requires a dependable surrounding.


In the East-West assistance business process, ethnical backgrounds, different social mentality, customs, tend to be forgotten by many people. As the cultural factor is the key factor that establishes the success or failing of business activities. Quite not the same as the normal trade, the international trade within different culture track record request more. Dealers should know each other's culture and custom perfectly. It's the warranty of success.

In international business, we should pay more focus on variations in cross-cultural communication. Correctly offer with cultural variations and stop the barriers which may be caused by social patterns and social prejudices. Among the personnel, everyone should respect the other person and treat equality.

The key to success in cross-culture communication is dealing with the culture difference properly; make an effort to exclude cultural superiority, cultural patterns and ethnic prejudices of the interference. This is the only way to carry out the international trade activities in cross-culture communication efficiently. We can build the international culture exchange centre; carry out the multi-level forms of culture screen and exchange to get rid of the idea of custom, vocabulary and art appreciation and other aspects of trade obstacles.

The formulation of foreign trade policy for the companies should be syncretised recover the local culture. We can't always concern a culture whether it's not suitable for our 'system'. It is necessary to generate the country's cultural products for sale, but also the way in which and level of pricing that people can allow, and look for ideal local custom channels to purchase items willing to simply accept the promotion. These links are vital, and only all of them are put together organically, the barriers can be damaged.

In bottom line, we stress that culture is the primary factor in business trade, and the major barrier is the difference between historical ethnicities. Social factors are inevitable. Cultural universals are dominating, and cultural differences can be bridged by international trade. Moreover, with the introduction of social interpenetration, the affect of cultural differences will become smaller. The cross-culture communication activity can be easier than before.

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