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The world is an ever changing place. What is taboo today may become a norm tomorrow. There are vast numbers of countries with various languages, religions and their cultural ethnicity. India has been referred to as a country which is a living example of unity in diversity. In today’s age of capitalism and free trade, borders are soon getting irrelevant and people are migrating, more than ever before, to achieve their personal and organisational goals. It becomes all the more important to understand cross cultural dynamics and its implications on international businesses looking to expand in new markets.
Why understand Culture?
Today we see companies looking towards new markets and industries to expand their businesses. Growth in the west is almost at its saturation peak and developed industries are looking to foray into Asian markets to promote their growth and take advantage of developing economies. There are a lot of constraints in entering new markets, businesses have to understand regional aspects and the environment which govern these markets. There are various aspects of the environment which are Political, Legal, Economic and Cultural. Economic, Legal and Political environment differ in different regions and are sometimes governed by their local culture. Culture in many ways influences and has a major role to define these policies. When businesses are entering new markets they can study economic limitations, political and legal environment. But “Culture is a man made part of the environment”(Herskovits, 1948, p.17).
Geert Hofstede in 1980 explained that Culture consists of shared mental programs that control individual’s response to their environment. It has been very easy to understand culture in terms of Hofstede’s dimensions and compare countries based on these studies. These are Power distance, Uncertainty avoidance, Individualism-Collectivism, Femininity and Masculinity. I once came across an advertisement from HSBC, where in a polish company selling washing machines wanted to know why their sales are highest in a part of India. When their representative visits the vendor he realises that the machine is used to prepare a delicacy rather than washing clothes. The punch line of the advert was “if you’re going to do business internationally you should be with a bank that knows about International business” During the 3rd session of Cross-Cultural Perspective we came across a task of negotiation.
My key learning’s during this task were that communication style and sharing of information was vital in successful negotiation beneficial for all. We started aggressively trying to force our opinion and make the other party aware about our concern and make them sensitive to our objective. But we soon realised that the key to a successful negotiation was dealing with the other party with co-operation and being sensitive to their needs. This realisation made us reach an amicable solution towards solving the “ugly orange case”. Hence we learned that a good negotiator should possess good negotiating skills, communication, multiple solutions and also should understand the emphasis of BATNA (best alternative to a negotiated agreement).
We also learned about Leaders and their qualities. There is an argument by some that leaders are born, others believe that leaders can be made. I am of the view that leaders are not born but made. I do have certain leanings in terms of charismatic leaders and their family tree, e.g. Indira Gandhi, Rajiv Gandhi and Sonia Gandhi, but to larger extent leaders can be made and groomed provided they have the necessary qualities and attributes to lead and motivate people. During my work assignment I spent a considerable amount of time in United States of America. I was spearheading a transition project which involved training, coaching and transitioning work from United States to India. My colleagues from America were straight forward and direct in their communication. The instructions and information provided by them was straight to the point and often construed by me as rude. I had a confrontation with my co-worker where I asked him to put in some extra hour of work. He was quite direct in refusing and also went ahead in telling me that this is not the way Americans work. I was influenced by the work culture in India and assumed that it is alright to ask a colleague to stay back a couple of hours after work. In the US, there was a lot of emphasis on work-life balance. Conclusion:
Now after getting acquainted with cross-culture perspectives and various theories I have better understanding between the cultural differences of America and India. I think that using the dimensions provided by Hofstede and theories based on these dimensions we can analyse and understand culture and their dynamics. These will be helpful to organisations entering new markets and regions.