The Ultimate Guide for Navigating International Corporate Culture
The Ultimate Guide for Navigating International Corporate Culture
Much of our economy is now global in scale. Successful local businesses quickly outgrow their original market and can only move forward on an international scale by reaching out to customers in different regions, countries, and continents. To do this, your company culture needs to include embedded knowledge and sensitivity of local customs as well as a framework for working with cross-cultural teams.
What is culture and how does it affect international business?
Culture is generally understood to be a set of beliefs, values, and rules followed by a specific country or group of people within a country. Culture impacts all areas of life from family and social grouping to the workplace and business. The impact of culture on international business cannot be understated. It can affect every aspect from decision-making and management strategies to negotiating contracts and interacting with customers. What may be acceptable as a business practice in one country may deeply offend colleagues in another. To avoid offense and costly misunderstandings as well as create optimum working and trading conditions, you need to develop an awareness of the impact of culture in international business. At BLEND, not only do we fully understand cultural nuances that could hinder your business message, but we can also help you create advantageous international strategies.
1. Cultural identity
While localizing your company culture, products, marketing, and strategies is vital for global success, this process has to go much deeper than language. How your messages are conveyed is just as important as the words used. For example, in countries such as the US, Spain, and Germany, people tend to speak assertively and loudly in the workplace, sharing ideas with confidence. In contrast, in Japan, quiet voices and passive sentence constructions are more normal. In fact, across much of Asia, great care is taken not to cause offense either by the tone of voice or the words used. Lots of subjects that can happily be discussed during meetings or coffee breaks in the US or UK belong only in the private sphere in Asia.
Another aspect of cultural identity is our mannerisms. The Italians use their hands to express themselves and as in many Latin cultures, are quite happy to shake hands, hug, or even kiss their colleagues. In the Middle East, South Korea, or Japan, such overt displays of affection could be considered intrusive or even offensive. Even shaking hands can be a minefield in international business culture. In the States and Europe, shaking hands to cement a successful meeting or business deal is the norm. This is less so in the Middle East.
2. Ethnic and racial identity
The biology and societal concepts of race and ethnicity are complex and cannot always be separated. Race tends to be viewed as something that sets people apart while ethnicity generally means the sharing of language, country, religion, and other cultural beliefs. In business relations with countries such as China and South Korea, it’s important to be aware of their collectivist culture. An entire cohort of people rather than one dominant individual will need to be persuaded that your product is right for them. This collectivism can also affect how multinational teams work together.
3. Religious identity
It is very often the religious aspect of ethnicity that needs to be addressed when considering the impact of culture on international business. This is especially so if you are dealing with countries such as the United Arab Emirates where Islam is the official religion. Islam pervades every aspect of life in many Middle Eastern countries and this should be respected in all of your business dealings. Modesty, generosity, and respect are highly valued within Islamic culture and these should be at the forefront of your mind when conducting meetings and deals or working with a multinational team. A hierarchical, top-down approach to business is also prevalent in the UAE with power and the ability to make decisions often invested in a single person.
Part of successful international business culture is recognizing the religious holidays of both colleagues and employees. Your work calendar should take account of both regional and national holiday schedules. In countries where strict observance prevails, religious obligations throughout the day also have to be observed and respected. Remember as well when doing business with Muslim countries that the weekend begins on Friday and not Saturday. Avoid causing offense and creating problems in the workplace by collaborating with localization experts such as BLEND.
4. Gender identity
As well as the obvious issues surrounding gender in multinational companies (such as imbalances in pay and representation), there are also more subtle factors at play that you need to recognize. For example, countries such as China and Japan have a high “masculinity level” where work is goal-oriented, and money and material possessions are valued and sought. This creates an environment where emotions and feelings tend to be kept private. Other Asian countries such as South Korea have a lower “masculinity level” where the quality of life and welfare of others is more at the forefront and showing feelings is more acceptable. This is reflected in the fact that South Korea has more women at higher corporate levels than China or Japan. It’s important to familiarize yourself with the gendered character of regions and countries you wish to operate in. Be aware of the status of everyone you come into contact with and treat them accordingly; follow local nuances such as whether women are expected (or allowed) to shake hands or not.
Gender identity can also be a big issue in retail marketing campaigns. Time and money spent researching consumer profiles can pay dividends for any business attempting to be truly multinational. In many western countries, a very high percentage of retail decisions are made by women, yet marketing campaigns are only just taking this into consideration, especially in sectors traditionally considered to be masculine, such as technology and transport. Female consumer habits also vary across generational and ethnic groups and should be carefully researched when localizing your products and advertising.
5. Individual identity
From the very first time you meet a potential business contact or team member or enter a meeting room, the way you address someone can have an impact. Different cultures have different expectations about how colleagues and clients should be addressed. Americans and, to a great extent, Europeans, are happy being addressed by first names once introductions have been met, whereas Asian countries prefer more formality at all times. It is always wiser to err on the side of caution and use titles and surnames unless invited to do otherwise.
6. Social identity
As we saw earlier, some societies are very hierarchical in nature while others are more relaxed. Scandinavian countries such as Sweden, for example, place great emphasis on social equality and this is reflected in the level of organizational hierarchies of its workplaces. In contrast, Japan is more traditional in its approach, with clearly defined hierarchies within businesses and great respect shown for senior members within the company. These different approaches impact how meetings are run and teams operate. In the Scandinavian models, everyone has a voice and will input their ideas freely, while in more traditional organizations, a different and more discreet way of sharing thoughts and proposing ideas may have to be found.
7. Character recognition
Being aware of all the different identity strands is an important part of creating a company culture that is totally multinational. These strands come together to create regional or national characters that can cause issues if you’re not aware of them. For example, attitudes to time are far more relaxed in the UAE than they are in the US or Northern Europe. Be prepared for meetings to start late or even be rescheduled at the last moment. Latin countries such as Spain, Italy, and Mexico can also be flexible with their timekeeping. While punctuality is seen as a virtue in the US and UK, your Italian colleague may arrive way beyond the scheduled start time of a meeting yet still consider themselves on time. Leave plenty of time in your travel itinerary or negotiations to accommodate these discrepancies.
8. Age factors
Finally, different countries and ethnic groups have different attitudes to age. While the UK and America are often accused of ageism with a tendency to put older staff members “out to pasture,” valuing youth, the opposite occurs in other countries. Seniors are given great respect and responsibility in the workplace, with younger members of staff treating them with deference and formality. Accommodating these differences and making everybody feel respected and valued is vital if a global company is to create successful multinational teams.
By failing to recognize the cultural diversity of clients, colleagues, and potential markets, you risk missing out on important future business or fully unleashing the potential of current contacts. The first step to creating a truly multinational company is a sensitive and open awareness of cultural identity. Using experienced and knowledgeable solution providers like BLEND helps you achieve this.
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