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Effect of culture in business Essay

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1. A growing number of Americans work for foreign-owned firms in the United States. Do you think that these American employees are being influenced by the foreign owner’s approach to management and the culture of the country of the owner?

Because of globalization, businesses are open to do business in new markets and improving profits. Also because of globalization, companies are faced with different cultures, religion and norms. For a company to do business in another country, a manager needs to understand the differences associated with the host country.

“Globalization is defined as this interdependency of transportation, distribution, communication, and economic networks across international borders” (Gibson, Ivancevich, Donnelly, & Konopaske, 2012, p 57). Each firm has their own organizational culture. According to Hellriegel, Slocum and Woodman (2001), organizational culture represents a complex pattern of beliefs, expectations, values and behaviors shared by organizational members. The knowledge of the culture in which an employee is working is crucial. “In a dynamic and fast changing environment the inter and intra organizational behavior changes the productivity and growth trends” (Chaturvedi, 2002).

Because of the organizational culture most foreign-owned firms will tend to impose that culture on their employees. Just like U.S. companies settling abroad, foreign-owned companies will face some difficulties operating in a country with different culture. Based on Hofstede’s research, which studies how values in the workplace are influenced by culture, four dimensions have been “identified as explaining:

Uncertainty avoidance: “degree to which people are comfortable with ambiguous situations and with the inability to predict future events with accuracy” (Gibson et al., 2012, p 69).

Masculinity-Femininity: A culture that has a high masculinity orientation tends to emphasize on dominance, assertiveness, and interdependence. A culture with tendency of femininity orientation will emphasize more on interdependence, compassion, and emotional openness.

Individualism-Collectivism: “Tendency of a culture’s norms and values to emphasize on satisfying individual needs or group needs” (Gibson et al., 2012, p 69).

Power distance: “Degree to which members of a society accept differences in power and status among themselves” (Gibson et al., 2012, p 69)

Because each culture fits differently in the four dimensions, a foreign-owned firm will keep its own culture as it will be easier to deal with than having different organizational cultures in each country it operates. Americans who work for those companies are indeed influenced by their approach of management.

2. Assume that you want to develop your global skills so that you can pursue international assignments with your company. Identify five skills that you would want to develop and describe how you would go about improving these skills.

“Globalization is defined as this interdependency of transportation, distribution, communication, and economic networks across international borders” (Gibson, Ivancevich, Donnelly, & Konopaske, 2012, p 57). Managers are more and more in contact with different cultures. According to HRMagazine (2012), business skills, clture and customs skills, geographic, political and economic skills need to be developed. Based on Gibson, Ivancevich, Donnelly, & Konopaske (2012), the five main skills are:

Global strategic skills: knowing how the economy (i.e. global financial markets), politics (i.e. foreign affairs, international law) are good ways for managers to know how to conduct business in another country.

Team-building skills: Companies require more and more that their employees know how to work as part of a team. Team-building is a way to have more done more efficiently. A manager should know how to delegate work and know what each team members can or cannot do.

Organization skills: It is important to know how employees react to certain management approach. McGregor’s motivational theory X and Y provides management approaches that can apply to motivate employees.

Communication skills: Communication is essential when working abroad. It is imperative that a manager or employee be able to communicate with peers and superiors effectively.

Transfer of knowledge skills: “Learning about a practice, technique, or approach in one country that can be transferred elsewhere is a skill that managers can apply on a regular basis” (Gibson et al., 2012, p 62).

3. Describe the attitudes a manager would need to be successful and effective in managing in India, China, and Saudi Arabia.

A manager would need to have the same basic skills in order to a successful and effective manager in India, China, and Saudi Arabia. According to Gibson, Ivancevich, Donnelly, & Konopaske

Strong technical skills

Good language skills

Strong desire to work overseas

Knowledge of the culture

Well-adjusted family situation

Spouse support

Behavioral flexibility


Good relational ability

Stress management skills

According Goodall and Warner (2007), a manager who wants to work in China would need to be:

Open-minded to the culture shock.

Desire to learn the language and culture.

Good communication skills.

Strong organizational commitment: “Think not what your company can do for you, but what you can do for your company” (Goodall et al., 2007, p 13).

In China, it is hard to retain employees due to the competition of labor. China does not have enough skilled labors and is experiencing tremendous growth economically. To be an effective manager, one should be able to retain employees and adapt to the culture in order to not lose such precious asset.

According to Bhuian, Al-shammari, & Jefri (2001), a manager needs have a strong organizational commitment, strong desire to work with foreign assignment, and especially good communication skills in order to work in Saudi Arabia.

Trainings should be available to the expatriate manager. Gibson et al. identified three steps:

“Predeparture”, which helps the manager prepare for the culture shock.

Overseas Assignments, which is to help the manager ease into the culture. Having a mentor or a guide to introduce him or her to the culture.

Repatriation, which is helping the manager adjusting back to his own culture when returning from assignment.


Assess-and improve-your global skills. (2012). _HRMagazine, 57_(8), 79. Retrieved from http://www.shrm. org/countryguides

Bhuian, S. N., Al-shammari, E. S. and Jefri, O. A. (2001), Work-related attitudes and job characteristics of expatriates in Saudi Arabia. Thunderbird Int’l Bus Rev, 43: 21-32. doi: 10.1002/1520-6874(200101/02)43:13.0.CO;2-B

Chaturvedi, A. (2002). Organizational behavior. _Finance India, 16_(4), 1482-1484. Retrieved from http://search.proquest.com.ezproxylocal.library.nova.edu/docview/224360708?accountid=6579

Gibson, J.G., Ivancevich, J.M., Donnelly, J.H., Konopaske, R. (2012). _Organizations: Behavior, structure, processes_ (14th ed.)_._ New York: McGraw-Hill.

Goodall, K.L.N., Warner, M. (2007). Expatriate managers in China: The influence of Chinese culture on cross-cultural management. _Journal of General Management._ Retrieved from: http://www.jbs.cam.ac.uk/research/working_papers/2007/wp0701.pdf

Hellriegel, Don, Slocum, John W. & Woodman, Richard W.; Organizational Behavior, South-Western Thomson Learney, 2001, pp 671.

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