Global Business Cultural Analysis: Germany

Germany has a rich history and has seen many changes throughout the past few decades. Though devastating struggles have been encountered, today Germany boasts the largest economy, as well as the second most populated country within the European countries. (Central Intelligence Agency, 2013) This paper will analyze the dimensions of German culture, how those dimensions affect the way business is conducted, and more specifically, how the business culture of Germany differs and may propose complications for American companies interested in expanding their business globally to Germany.

Overall, there are certainly differentiations in German and American business culture, however, none that would inhibit a business to be successful through a global expansion.

As Cesar Chavez once said, “Preservation of one's own culture does not require contempt or disrespect for other cultures.” An unbiased point of view or mindset is crucial when one is considering conducting business in a country whose culture differs from that of the said businessperson’s own culture. That is, if business success is a top priority.

Get quality help now

Doctor Jennifer

Verified writer

Proficient in: Business

5 (893)

“ Thank you so much for accepting my assignment the night before it was due. I look forward to working with you moving forward ”

+84 relevant experts are online

Hire writer

The successful global business embraces the culture of the particular country in which they wish to do business and is flexible while still maintaining a strong grasp on their own core values and cultural beliefs.

Before one can be successful at differentiating the differences of two cultures, it is important to have a full understanding of what culture is. Quite often the culture of a particular country or region is thought to entail the arts, food, music and language of an area. Culture encompasses so much more than the elements listed above.

The culture of an area is what defines who they are, how they operate, and how they relate to people outside of their culture. The dimensions of culture can be categorized as communication, religion, ethics, values and attitudes, manners, customs, social structures and organizations. (Saterlee, 2009) Saterlee goes on to describe each of these categories of culture by breaking down the complexity of each.

The way a culture eats, dresses, speaks (including verbal and non-verbal communication) conducts business, punctuation, gender roles, expression of emotions, and education are all just examples of subcategories that fall within the dimensions provided by Saterlee. Clearly there is much that can be learned not only about the culture in which a business wishes to pursue operations in, but also in the said business’s own culture. As mentioned earlier, a profound understanding of one’s own culture is imperative when conducting business in an entirely different culture. “Our greatest instrument for understanding the world--introspection….The best way of knowing the inwardness of our neighbor is to know ourselves.” (Lippmann, 1914) What are the major elements and dimensions of culture in Germany? The following question will be answered by covering the history (including previous government style and modern), religion, customs, social structures and ethics, as well as communication. History of German Government

Up until 1990 Germany was a divided nation consisting of two parts, Eastern and Western Germany. With the arrival of the Cold War, Germany was divided and two states were formed in 1949. Western Germany formed the Federal Republic of Germany (FRG) and Easter Germany formed the German Democratic Republic (GDR). The western Federal Republic took sides with the European Commission (EC) and the North Atlantic Treaty Organization (NATO) while the eastern German Democratic Republic sided with the communist Soviet-led Warsaw Pact. Germany was unified in 1990 with the diminishing of the Union of Soviet Socialist Republics (USSR) and the decline of Communism. From this unification, Germany became a stronghold in the European Union (EU) and as mentioned earlier became what is still the most populated European country.

Rebuilding a unified Germany. Following the unification of eastern and western Germany arose the issue of combining two different economies into one successful economy. This posed many problems due to the success of Western Germany and the lack of success in Eastern Germany. The eastern side had been on a steady decline for the previous years leading up to the unification in 1990. When the unification occurred, it was time to create solutions for a successful merge of the two states to become one flourishing economy. On May 18, 1990 a treaty was formed between the two states, which addressed economic and financial matters.

Arising from the treaty an agreement was met that stated the Federal Republic would exchange valuable, convertible western marks for less valuable, non-convertible eastern marks. A more in depth look into what is needed for the successful intertwining shows that large investments in communications, railroads, highways, and utilities are major areas that need assistance within Eastern Germany. Large companies including Volkswagen and Siemens A.G. made massive investments, which, in turn helped boost the economy and employ thousands of workers. (Harris, 1991)

Transition from a Dictatorial nation to a Democratic nation. Throughout history Germany encountered many struggles while trying to develop a democracy. Some of these struggles were caused by perceptions of which were influenced by prior autocratic or dictatorial regimes. Similar to a ghost, the ideology of these previous regimes remained after their fall even during the transition to the new democracy. After the unification in 1990 there were problems that East Germans faced in regards to transitioning to a new style of government. East Germans were unfamiliar with the new democratic style of government. The transitions did not come as a complete shock due to the exposure of such governing principles viewed through media. Before flourishing, there were some economic struggles faced as well by East Germans. (Saafeld, 1997)

Religion There are many similarities between the United States and Germany in relation to religion that will be discussed in further detail later. Germans have the freedom to exercise any religion of their choice. The German Basic Law describes the context of religious freedom within the country. More specifically explained in Article 4: Article 4 [Freedom of faith, conscience, and creed]

(1) Freedom of faith and of conscience, and freedom to profess a religious or philosophical creed, shall be inviolable. (2) The undisturbed practice of religion shall be guaranteed. (3) No person shall be compelled against his conscience to render military service involving the use of arms. Details shall be regulated by a federal law. (Federal Republic of Germany, 1993)

The main premise on which the scope of Article four of the German Basic Law was established was the case of Rumpelkammer in 1968. This case was brought about when a Roman Catholic youth organization was planning on practicing their faith missionary style in public. The group would raise money by collecting used goods such as clothes and other recyclables. The money that was obtained through the recyclables would then be donated to various charities. The group obtained support from priests by having them encourage parishioners to donate. The issue at hand was when a commercial rag dealer began to complain that the groups’ activities were illegal and in turn hurting his business. The businessman took it to court and actually won in the lower court system, however, the Constitutional Court disagreed and overturned the lower court’s decision to ban the youth group’s method of raising money.

[The Article Four guarantees of religion---irrespective if the creed is rooted in religious or nonreligious ideological belief—entail not only the inner freedom to believe or no believe, that is to profess a particular creed, or to remain silent or disavow a previously held creed and profess a new one, but also the freedom to engage in ritual acts, to proselytize, and to propagandize….Religious exercise has central meaning for each faith, and in view of its historical content, must be interpreted broadly. It includes not only ritualistic acts, like adherence to religious practices such as worship services, church collections, prayer, receipt of the sacrament…but also religious education, religious and atheistic celebrations and other practices of religious or nonreligious life.”] (Eberle, 2004)

Germany also has an excellent state-church relationship. We see that this was developed early in German history with the strong roots of the Catholic Church embedded in German government. It is known that during the middle ages the Catholic Church maintained an adherence to education particularly in the areas of reading, writing, mathematics, accounting, and the study of science and philosophy. Eberle states, “The deep association of the Catholic Church with learning is a major factor in the cooperative relationship that has developed between church and state over education. Europeans became accustomed to looking to the Church for support and contribution to society.” (Eberle, 2004)