The Business of International Business is Culture
-Geert Hofstede
Views on the International Business Perspectives
International communication has been the research topic of various scholars and disciplines for several decades. The phenomena of globalization brought upon internationalization and growth of businesses, thus resulting into practicality and necessity of it. Due to the increase in business opportunities’ number beyond the borders of their own country, numerous organizations choose to extend their activities abroad frequently without understanding that the prospective financial growth can result into disastrous conditions because of the inappropriate communication with the individuals from the other countries.
One of the typical misconceptions among the executives of the enterprises is that business communication is considered to be universal globally and not influenced by differences in cultural backgrounds. But in fact people from different countries and cultures behave and think inversely (Kvantaliani & Klimina, 2011, p. 1).
Culture is the values, beliefs, practices, and mind-sets of a people group. It foresees the behavior norms and pattern of that group, e.g. the assumptions, the rules, the perceptions, and the reasoning and logic by which a group is characterized (Carpenter & Dunung, 2016, p. 103).
Cross-cultural communication means an intercultural communication’s part and deals with the comparison of different ways individuals communicate across borders. The ways of communication between people are significantly influenced by their culture, background, values, norms, and world perceptions (Kvantaliani & Klimina, 2011, p. 2).
For example, speakers from Asia tend to use inductive approach to communication when the situation background or reasons are provided prior to presenting the suggested action or main point. At the same time, Europeans / Westerners apply direct (or deductive) approach in the situation’s explaining (Kvantaliani & Klimina, 2011, p. 3).
With the purpose to have a positive business relationship with the other cultures’ members, an individual should possess cultural sensitivity and take into account cultural dimensions. In view of the cultural differences, managers should also consider the probability of communication barriers’ encountering (Kvantaliani & Klimina, 2011, p. 9).
Cultural Dimensions of Hofstede
Cultural dimensions research performed by Geert Hofstede is well-known (even though some scholars criticize it) and is broadly applied in many cross-cultural investigations. Hofstede researched national differences in cultures and performed comparisons between them. This researcher validated and identified the first four national culture dimensions: masculinity/femininity, power distance, individual/group orientation, and uncertainty avoidance. Later Hofstede added fifth dimension to his model of cultural dimensions: long term / short term orientation (Kvantaliani & Klimina, 2011, p. 10).
Cultural Value Orientations of Hall & Hall
Several ideas that appeared to be relevant to intercultural communication belong to Hall and Hall and relate to communication and time. These researchers studied cultural value orientations, such as:
Time perception: time orientation and time focus;
Language: non-verbal and verbal;
Communication: low-context and high-context (Kvantaliani & Klimina, 2011, p. 13).
Verbal and Non-Verbal Language
Verbal Language
The characteristic feature of the language is that it is ambiguous. It foresees that people can never be sure in the meaning of other person’s words, either in writing or in speaking, and that the language can never express fully the feelings of the individuals.
Differences in language remain the most significant obstacle in the process of cross-cultural communication. It may become a communication barrier in situations when a person has complications in other party’s language understanding, their body language or uses faulty or poor translations. Cross-cultural communication demands not only another language skills, but also awareness of the cultural practices, customs, and values and non-verbal behavior (Kvantaliani & Klimina, 2011, p. 15).
One more factor that frequently provokes problem with cross-cultural communication is errors during translation; however, it rarely leads to the conflict between business partners. Such errors may be detected easily in the communication process.
Body Language or Non-Verbal Communication
Even though not directly dependent on the language use, non-verbal communication is very important for correct understanding of the other party’s message. This may include glance, touch, proximity, eye contact, facial expressions, posture, and gestures. People frequently apply non-verbal means to emphasize a verbal statement. Individuals from some cultures can consider certain non-verbal methods of communication that are used in other countries to be offensive. Respect and understanding of the signs of non-verbal communication of the other culture can secure an existing or potential business relationships.
Technological Means Used for International Communication
Nowadays multinational companies communicate with individuals from foreign countries using different technology types, such as internet, email, company chats, teleconferencing, social networks, etc. There are, for example, some advantages of email using in comparison with the face to face communication. As such, it may eliminate formality that often causes difficulties and misunderstandings in the process of cross-cultural communication. Also, individuals possess more time to process and compose messages and can edit them before sending (Kvantaliani & Klimina, 2011, p. 16).
Technology, especially communication that is computer-mediated, is now a main driver of cultural convergence creating globally and international business’s facilitating. Separate business units of multinational companies are connected due to technology. Large physical distance is now not a main obstacle for global business’s spread. Innovative communication means make possible for users to access a large factual information amount globally, but not always it increases their possibility to learn it at the same level as the information is diffused or disseminated. Also, knowledge and information are accepted through the cultural lenses, and the diffusion or transfer of knowledge inside organization is not simple to transmit across borders (Leung, Bhagat, Buchan, Erez, & Gibson, 2005, p. 360).
Individual Factors Influencing Cross-Cultural Communication
There exist several individual factors that can hamper communication with foreigners, for example, ethnocentrism. Difficulties in business communication that take place between people from different cultures frequently occur in cases when individuals from one culture consider themselves to be superior in comparison with the representatives of other cultures. Numerous individuals are ignorant of the cultural similarities and differences that are important for the cross-cultural communication. Individuals characterized by ethnocentrism perform suppositions regarding others on the basis of the cultural background of their own (Kvantaliani & Klimina, 2011, p. 17).
According to Kvantaliani & Klimina (2011), the major implications of communication are related to:
power distance difference;
degree difference of uncertainty avoidance;
communication context: low vs. high;
language used / common language insufficient knowledge;
barriers of technological character;
personal understanding of cross-cultural communication (Kvantaliani & Klimina, 2011, p. 31).
Cultural Characteristics of Business Behavior in Different Countries
In cultures characterized by high-context, e.g. Japan, meaning is expressed by body language, rephrasing, pauses, as much as in the verbal language used during meetings, while in a cultures with high-context (e.g. the United States) message’s meaning is expressed mostly by spoken language. In the U.S. business persons expect direct eye contact and it is considered to reflect honesty, reliability, and trustworthiness. To the contrary, in certain parts of Africa and in China, direct contact of eyes is regarded to be inappropriate and rude. In addition, direct contact of eyes with a senior or superior individual demonstrates hostility and disrespect in India (Okoro, 2012, p. 134).
The increasing workforce diversity recently makes it very important that global and domestic managers should pay more attention to learning necessary skills of communication, particularly for efficient diverse organization’s management (Okoro, 2012, p. 134).
Unlike in the U.S., most people in China are reserved. A business person from the United States treats business as separate from personal relationship. They form friendships quickly as well as dissolve them. Thus, people consider business relationships in the U.S. as short-lived and shallow, while in China business relationships are regarded as lifetime commitments. Business etiquette in China is directly related to the local people’s sensitivity to face. Face can be considered to be an assessment of an individual’s integrity, self image, and credibility. Business persons in China use many communication strategies elaborated to give face or receive face from others, e.g. intermediaries, indirectness, requests, shaming, and praising. Local people frequently use indirectness by means of public confrontations avoiding with the purpose to save face. In order to avoid direct confrontation they often use intermediaries, especially when there are conflicts, e.g. a contact has to be established before foreign business partners come to China. In this country people believe in a win-win strategy of negotiation that makes possible for both parties to become winners with the purpose to strengthen the relationships. Businesspersons in China use praise to recognize position and status.
As mentioned above, while working with Chinese business partners, business etiquette rules are determined and controlled by face taking and giving. As such, during introductions, the given name comes last and the surname first. The person’s greeting is accompanied with a bow that is not typical for many other countries. Special attention should be paid to the exchange of business cards at social gatherings or meetings. It is considered to be polite to respectfully and carefully read what is written on the business card prior to putting it on the table or in the pocket as a respect sign. As a rule, in China people use both hands while receiving and presenting cards and put them in front of themselves in order to see or read easily (Okoro, 2012, p. 135).
Great Britain’s business etiquette is based on a strong nationalism and identity sense. Business persons from England are very deadline oriented and matter-of-fact in negotiations on business. Customs and traditions are very significant to them, because they are usually reserved and would like other parties to be the same. Business friendships are not important for them. In view of their individualist culture, similar to Americans, they are concerned on the duties in accordance with their description of job and suppose that a boss should notice an effort of an individual. It is recommended not to ask too many questions of personal character quickly, as it may make them nervous as in their culture they are reserved naturally. The business person from Great Britain that has excellent decorum and manners often demonstrates poor people skills (Okoro, 2012, p. 135).
Excellent quality conservative attire is important for British business persons when judging appearance and dress. The same as in other countries of Europe, dress is a business and social status indication. Inappropriate attire in this country includes tennis shoes and sweat suits. The process of English businesspersons’ negotiations is very polite and formal and they focus on proper etiquette and protocol. English can be ruthless and tough negotiators and may sometimes appear eccentric and quaint. They may lose reserve quickly once their assumptions about themselves are questioned or challenged.
German business etiquette is based on this country’s formal culture. Businesspersons from Germany respect hierarchical differences and authority. In this country people approve an organizational structure of hierarchical type as it helps to eliminate uncertainty and power is clearly concentrated within the company. They use formal communication for business conduct. Germans focus on truth and personal achievements and directness is a significant aspect for them. Germans consider class status to be important, and although all individuals under the law possess equal rights, actually inequalities exist in this society.
Being just several minutes late for business meeting may be insulting to managers in Germany and in case a person expects to arrive late, it is recommended to call and inform about it. One more characteristic feature of German etiquette is their introductions practices. In this country business persons, when addressing someone, always use a title until German partner says it is accepted to use only names. The relationship between the employee and the company is contractual, that means that Germans are paid for certain quantity of hours and the work has to be as hard as possible during these hours (Okoro, 2012, p. 136).
Business etiquette in Japan, as in the other cultures of Asia, involves a high-context communication. High-context culture means that people rely on verbal communication less and mostly on the environmental settings and nonverbal actions to understand the meaning of the message as it includes many cues and interpretation “between the lines”. Negotiators of contracts in Japan can devote much time to establishing relationships than to agreements’ conditions. Their negotiations style can be rather confusing to the non-sensitive, uninitiated foreigner. As such, they may say yes instead of no and determine whether yes is no or really yes by the context. Once businesspersons from Japan speak, they suppose that the individuals should interpret the meaning by their cultural values knowledge and understand what lies behind the spoken words.
As business persons in Japan do not say “no” and have nonverbal and verbal cues, partners from the other cultures should ask many questions to be sure in what is being said. The goal of the first business meeting in Japan is to create a personal trust. Most of the time is devoted to exchanging companies’ information prior to discussing business. Creating friendships and relationships in this country is very important for business relations. In Japan signing an agreement does not signal a negotiation or sale but a relationship continuation with duties and obligations in the future (Okoro, 2012, p. 137).
Cultural Diversity inside Organizations
Cultural diversity is broadly spread inside many companies nowadays. According to Gomez-Mejia & Palich (1997), international companies do not face decreasing performance outcomes when they deal with the cultural diversity. Companies are able to overcome the issues with growing cultural diversity by means of the deliberate strategies, such as more investments into advertising and marketing to provide impact upon the customers’ choices) or positive economic sides of internationalization (e.g. entering new markets, cheaper raw materials and labor access) can compensate any costs related to overcoming of cultural barriers (Gomez-Mejia & Palich, 1997, p. 326).
According to Tihanyi, Griffith, & Russell (2005), previous research has offered various empirical data concerning the cultural distance’s specific influence. There is some evidence regarding a negative influence of cultural distance upon the performance of multinational organizations; however, other researchers have provided information about a positive influence. Also, foreign operations managing portfolios with larger cultural distance has proved to increase operating costs and transaction, causing a more significant hazard of survival among multinational organizations. At the same time, significant cultural difference has been connected to low levels of failure among joint venture (Tihanyi, Griffith, & Russell, 2005, p. 271).
Conclusions
Taking into account the above information, it is possible to conclude that knowledge of culture plays a significant role in the negotiations with the foreign businesspersons and influences the overall success of international business. It is clear that managers of the companies that are going to start communication with foreign business partners, open subsidiaries in the other countries or outsource their production and/or R&D activities should first acquire enough knowledge and skills in intercultural communication, e.g. learn the language, customs and traditions, values and beliefs of the target country/culture. According to the results of the research, it can significantly improve their opportunities for success.
References
Carpenter, M. & Dunung, S. (2016). Challenges and Opportunities in International Business (p. 103).
Gomez-Mejia, L. & Palich, L. (1997). Cultural Diversity and the Performance of Multinational Firms. Journal Of International Business Studies, 28(2), 326.
Kvantaliani, M., & Klimina, O. (2011). Implications of cross-cultural communication in business: A study of Swedish small enterprise “ImseVimse” and its international distributors and retailers. Gotland University, 1-47. Retrieved from http://www.diva-portal.org/smash/get/diva2:421545/FULLTEXT02
Leung, K., Bhagat, R., Buchan, N., Erez, M., & Gibson, C. (2005). Culture and International Business: Recent Advances and Their Implications for Future. Journal Of International Business Studies, 36(4), 360. Retrieved from http://lib.cufe.edu.cn/upload_files/other/4_20140605102213_Culture%20and%20International%20Business%20
Okoro, E. (2012). Cross-Cultural Etiquette and Communication in Global Business: Toward a Strategic Framework for Managing Corporate Expansion. International Journal Of Business And Management,7(16), 130-137. Retrieved from http://www.ccsenet.org/journal/index.php/ijbm/article/viewFile/15811/13027
Tihanyi, L., Griffith, D., & Russell, C. (2005). The effect of cultural distance on entry mode choice, international diversification, and MNE performance: a meta-analysis. Journal Of International Business Studies, 36, 271. Retrieved from http://www.ou.edu/russell/pdf/JIBS.pdf
