‘‘BUILDING BLOCKS OF CULTURE AND ITS IMPACT ON
POLITICAL, ECONOMIC AND BUSINESS SYSTEM’’
Prepared By:
---JAY MODI---
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MEANING OF CULTURE
Culture refers to the possession of knowledge, values, ideas, beliefs,
religion, attitude and experience by a group of people from their family or
environment and can be applied over a period of time.
E.g. People in India follow different Marriage rituals based on their culture.
INTRODUCTION TO BUILDING BLOCKS OF CULTURE
In customized world of today, each and every individual or institution wants
to increase their scope, they wants to be recognized by others but what stop
them are cultural boundaries. Though we say that now the whole world is
one global village but still it lacks cross-cultural literacy i.e. people are ill-
literate in understanding of how cultural differences across and within
nations can affect the Political System, Economic System, Business System
and Social System.
POLITICAL
BUSINESS
CULTURE
ECONOMIC
Building Blocks of Culture Jay R Modi

CULTURAL IMPACT ON POLITICAL SYSTEM
Political system is so strong that it defines economic and business system of
every country. To get the better understanding of cultural impact on political
system, we can take the example of India. In early 1990’s political ideology
in India has shifted away from state planning toward a free market
orientation i.e. Privatization of state-owned enterprise but yet there were
roadblocks of culture differences between different states came in the path of
success and it failed to attract many foreign companies.
In one of case from Harvard Business School, ‘‘Exporting American
Culture’’, an American entertainment company tries to enter the Turkey
market for the expansion of business but the political system in Turkey made
it difficult and the main reason was protecting the Islamic culture from the
exposure of western culture(American culture).
• Difference in culture within the country forces the political system to
prevent the entries of foreign culture.
• Even resistance by the people to adopt different culture affects the
political system
• In Gujarat, India political party is unstable since more than a decade
because of the riots between Islamic and Hindu culture.
Building Blocks of Culture Jay R Modi

CULTURAL IMPACT ON ECONOMIC SYSTEM
Even in Economic System, culture has it root. The type of goods and
services to be produced in a particular country is basically determined by the
culture of that country. E.g. McDonalds serves wine in Germany and beef in
America but this is not the case in India as it is against the Hindu culture to
eat beef.
Several companies failed to succeed in the foreign market because of their
ill-literacy in learning cross-culture. In 1992, Disney opened $5 billion Park
in Paris but it failed to meet the customer’s expectation because of following
reasons:
• Disney’s policy of serving no alcohol in the park whereas in Paris
a glass of wine is must with the lunch.
• Disney thought Friday will be the busiest day in terms of
customers but people in Paris prefer to visit park on Monday.
• Europeans don’t prefer to stay at the park as long as American’s
prefers to stay.
From the Disney’s example it is clear that culture plays an important role in
shaping the Economic System of any country.
Building Blocks of Culture Jay R Modi

CULTURAL IMPACT ON BUSINESS SYSTEM
According to several economists, due to the rise in Global Corporations,
whose products can be found around the world, has created conditions for
merging of culture and a reduction in variation of culture which resulted in
resulted in less significant impact of culture on Business System. But still
there are countries where we can find the cultural impact on Business
System.
E.g. Microsoft faced a serious obstacle to achieve success in China due of
rampant level of software of piracy in China where 90-95% of software used
is pirated which is treated as illegal in western countries but still Chinese
Government was supporting the piracy and it also allowed to export the
pirated CD-ROMs to Hong Kong for $52 which were originally worth
$20,000.
Many companies failed to succeed in foreign markets because of cultural
problems like:
• Differences in the taste and preference of Customers
• Difference in the language, religion and training requirement of
people in different countries.
• Even difference in the standard of living plays an important role.
Building Blocks of Culture Jay R Modi

SUGGESTIONS TO OVERCOME THE PROBLEM:
• To learn the political environment of country where the company is
doing business.
• To train the employee’s on how to learn the local culture before
sending them to other country.
• To analyze the market potential in terms of customers taste and
preferences.
• To establish good relation with various stakeholders’ like suppliers,
Government and customers where the company is doing the business.
• To study the SWOT analysis of the same industry before a company
enters any new country.
CONCLUSION:
If we study the examples given above, it is clear that culture is building its
block in all the system. Cultural blocks have its influence not only in
domestic market but even in international market. But there are several steps
which should be taken in order to overcome this problem.
Building Blocks of Culture Jay R Modi