Describe the importance of understanding culture in global b

Describe the importance of understanding culture in global business dealings

Solution

Culture refers to the views, ideas, belief that influence the behavior of individual or group. Culture plays important role when doing business globally. Global firms need to understand the culture of foreign countries before doing business. Culture of people in different countries influence their buying decision. This contributes to the success of the product or service.

The difference between US culture to that of the culture of foreign countries are:-

Globalization is the process by which the business or organization extend its operations internationally by developing international influence. This is developed by integrating and interchanging the views, products, cultural aspects, etc. internationally.

Conducting business globally is very important and crucial decision made by the business and require lots of effort and correct decisions in order to make it an effective move. It not only provide new opportunities for growth and profit but also provide reputation to business globally.

Any company can go global in order to diversify its market and customer base. They can also increase the sales life of their produce and reduce their dependence on current market. To overcome seasonal fluctuations, companies sell its products in different markets. Globalization also provide them opportunity to compete and grow.

Cultural difference impacts on the operation understanding between company and its global supplier. Company should take into accounts the corporate culture in order to build strong relationship with the global supplier.

For example - French culture and U.S culture are very different and don’t get along easily as compared to other nations. Since there is a huge cultural difference, doing business without understanding the culture of France, the business would fail. Therefore the manufacturing firm should tailor its operation as per French culture in order to operate well in France.

Language is one of the barrier for international business. When business are outsourced to another country whose language is different, then the customers may not understand and impact the customer experience. Thus a business should consider this factor before expanding its business in another country. Language difference impacts staffing because the employees may not understand the business culture, structure and other business aspect effectively.

Cultural difference plays important role when negotiating with people in other country.

Culture plays important role in international business. Organizational culture, work environment, values, ethics, structure, working style, etc. are important factors of the organization that contributes towards motivation of its employees. Thus, cultural factor should be considered when doing business globally.