Culture And Its Impact On International Business

5020 words - 21 pages

Culture and its Impact on International Business

As businesses have grown and expanded to the international level; certain aspects of business have become abundantly clear. One thing that has become the norm when doing business on the international level is dealing with different cultures. Culture, as defined by Geert Hofstede is “the collective programming of the human mind that distinguishes the members of one human group from those of another. Culture in this sense is a system of collectively held values.” The concept of a culture has been around for a very long time; in-fact, when people exist in the same place together they end up following a set of rules. These rules ...view middle of the document...

S. business on their learning,” (2011, p. 17).
On the other side of things Lung-Tan gives a unique view on how to measure culture; “How to measure culture has been a fundamental challenge for scholars in the field of international business and still is in debate (Gould & Grein, 2009; Venaik & Brewer, 2010; Leung et al., 2011). It is necessary to understand the concept of culture in order to discuss the relationship between culture and international business,” (2012, p. 109).
Prašnikar, Pahor, and Svetlik state “corporate cultures will continue to be important. For managers, the key to making business decisions is business interests. However, there will not be only one corporate culture (i.e. US-dominated), but instead diversified corporate cultures as multinational companies (‘MNCs’) will originate from more than one country,” (2008, p. 23).
Mahoney James is under the belief that, “Claims of widespread corruption in international business has stimulated a considerable amount of activity both in academia and in international organizations," although strong arguments have been made that bribery and corruption are not cultural characteristics, as they have so often been called, but symptoms of cultural breakdowns under the pressures of a malfunctioning economy,” (2012, p. 13).
Li preformed an analysis determining, “We hypothesized that, overall, Chinese students would be more likely to make less ethical decisions than their American peers due to the differences in four cultural dimensions: (a) small versus large power distance, (b) individualism versus collectivism, (c) difference in socioeconomic values, and (d) rule of men versus rule of law. The logit regression results strongly support the hypothesis,” (2011, p. 15).
Almhedie, Baruch, and Iles bring the concept of different managing systems for HR in the Middle East, “Arab management faces an ever-increasing challenge to keep up with management in developed countries due to globalization; the introduction of MNE operations can result in the "transfer" of best practices in HRM, as in Israel. A study into transferability of HRM practices in joint ventures based in Iran, found that ownership and control of critical resources, the compatibility of national culture, socio-cultural differences, mutual trust and respect between partners and the compatibility of management styles were important factors,” (2012, p. 468).
Al-Shalabi, Neimneh, and Obeidat discuss the reception of American Culture in the Middle East where bias is a large difficulty, “The West, driven by its interests and blinded by bias and hostility, has been keen on colonizing the Middle East, empowering Israel, and foolishly disregarding the aspirations of Arabs and Muslims, which tremendously contributes to generating anti-American sentiments and bitterness,” (2011, p. 156).
Archicvili, Cornachione, Jondle, Kowske, Li, and Thakadipuram study is on, “managers’ and employees’ perceptions of the state of ethical...

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