Good morning board members, I am Nikki Jensen and I am here to discuss how vital it is that the company takes into account cultural differences before embarking upon an international business plan. There have been many embarrassing enterprise blunders because of failures to learn the customs and traditional values of other countries, and I anticipate that Impact Real Estate will not become another statistic.
Cultural differences relevant to business include power and status issues, gender issues, negotiation, communication, relationships, manners, gifts and religion. All of these factors are of great magnitude and the success of Impact Real Estate will greatly depend on this knowledge.
The first concern that I will address is power, rank and status roles. This involves how cultures manage their professional roles and positions – including women – and symbols that reflect these. There are numerous degrees of sensitivity regarding the roles of workers, and understanding these will determine the success of a business. For example, in some Asian countries, they focus on the success of the group collectively, and value roles in the workplace very dearly. Understanding status is useful when selecting a suitable candidate to negotiate, as avoiding offending will be much easier. Likewise, whom they send will demonstrate how interested they are in doing business.
Status symbols include the environment, such as office location and furnishings, means of transportation, clothing, and even working hours. To determine the various differences in status symbols in cultures is helpful in determining who is who in companies throughout the world.
A precarious topic is the roles of businesswomen. Often companies do not consider sending women overseas in the first place, due to the delusion that many countries do not tolerate female workers. Because of the limited numbers of women working internationally, male workers might face some confusion as to how to communicate appropriately with women. An important consideration for women also is to learn about foreign religions. Should a businesswoman hug a Jewish man, he would need to undergo ritualistic cleansing. It can be drawn from this example, that awareness of cultural differences again determines the success or failure of a business, and perhaps even someone’s professional career.
Closely related to status and ranks, how negotiations and decisions are made should be understood. This involves knowing who makes decisions, who assists in the process and the speed at which conclusions are drawn. For example, the North American speed of decision-making is much faster than that of France. In Europe also, the approach is a reserved focus on the ethics and morals behind the deal.
Communication is crucial for international enterprise. Even within English dialect, numerous meanings can be conveyed in a single phrase. When writing to foreigners, the word choice should be simple and it is good manners to communicate in the foreign language. Remember that normal business organisation should be maintained, so ensure that all communication technology and equipment is in working order. Many cultures value face-to-face communication the most, so it is also important to learn the correct titles and names of foreign counterparts. Some Asian countries state surnames then given names, unlike Westerners. Lastly, translations should be checked numerous times to ensure the message is communicated correctly. Failure to do so has resulted in countless cultural errors in the past.
The most overlooked form of communication, body language can easily lead to misunderstandings. For instance, the clear-cut Western nodding of one’s head for “yes” means “no” in Bulgaria. To avoid slip-ups it might be necessary to repeat one’s thoughts verbally. Business attire should be acceptable also, not too radical in style or colour as colours have certain emotional or spiritual overtones to them to different cultures.
Social relationships are sometimes important to business as some cultures will expect various degrees of social interaction prior to business dealings. This might be dinner with a representative, or even with their entire family. Firstly, never be offensive or rude. If one strongly disagrees with an Asian on a political or ethical matter, they must try their best to keep quiet. Should a person be invited out they will need to ponder an appropriate way to either accept or decline the invitation. It must be remembered that there are many countries, such as in Northern Europe, where there is a line drawn between social events and business. Where this occurs, some businesspeople refuse to meet for lunch, so like any other behaviour, it is vital to acknowledge cultural differences.
Awkward introductions in international enterprise can be avoided, if one understands of how to greet another of a different culture. There are numerous gestures but to know which one to use if of great importance. Thais bow slightly to greet each other, and to not return one would be similar to not shaking hands in Australia. Conversely, the use of handshakes is increasing in Asia and the Japanese often shake hands and bow with Westerners to maintain their traditional values of rank and superiority.
Cultures have many social norms for acceptable behaviour and it is important to understand these. For example, in a Western business meeting, a person would definitely be frowned upon if their mobile phone rang during an important discussion, but no one should dare tell a Chinaman to turn off his own device. Behind me I have some particulars of acceptable behaviour. Table manners can sometimes be important – misunderstandings about hygiene and etiquette may deter someone from accepting offers. Countries all over the world value punctuality in many ways, and before going to the country, we need to know what is expected of meetings. Business cards also might be valued, but sometimes they can be seen as a symbol of obnoxiousness.
Gift giving in Australia is more of a personal choice, but viewed agreeably if the effort has been made. In some societies, however, it may be an expectation, and prior to meeting foreigners, thought should be made as to what an appropriate gift might be. For instance, as the French value their wine extensively to present them with a bottle would greatly offend. Often personal favours are even esteemed higher than material items. In China, for instance, assisting someone’s children attend a Western university is appreciated. As the opinion of acceptable gifts varies, it is quite important to answer the above questions, in case undesired gifts are seen as an offensive bribe.
Religion must not be overlooked in business, as it plays an important role in the formation of culture. In countries where there is a large diversity of belief systems, it can be complex in deciding appropriate behaviour as to not offend anyone. Such countries, like China, are often officially atheist, with less of a religious impact on business than others. One widespread example of how religion does affect business is in Islamic countries. Muslims are expected to pray five times daily and fast for the month of Ramadan, so working hours are changed to adapt. This might be seen as inconvenient to some Westerners, but if one does not accept the religious customs of their foreign business partners, they may find themselves unwelcomed.
The variety of culture throughout the world and the emergence of many powerful nations into global enterprise emphasises the need to recognise cultural differences. If Impact Real Estate aims to expand its market to overseas business, the factors that I have covered are all equally important in doing so.
Cultural Diversity in the Workplace
Cultural Differences in the Business World Impact Real Estate May 2005
Overview of Presentation Power, role and status issues Respect for rank and position Status symbols The role and status of women Decision-making issues Communication Verbal and non-verbal Establishing social relationships Social Behaviour Greetings Manners and etiquette Bribes and gifts Religion
Rank and Position Respect for positions is higher in countries where the family has a big impact on business Knowledge about rankings will Avoid dealings with inexperienced members of the company Determine their interest in dealing Clear up who is appropriate to deal with them
Status Symbols Understanding is necessary in decoding professional ranking system Often showed through Office size and location Vehicle and housing Whether one drives or is driven to work
Role and Status of Women Some confusion in cultures of limited female participation in enterprise Some males may not comprehend communication with female co-workers Expectations of wife and mother roles often taint professional status Misconceptions of intolerant cultures prevent numbers of international business women increasing Expectations of failure can mean limited support from home company Higher need to pay attention to religious codes regarding gender roles
Decision-making It is best to understand; Who makes decisions Who assists in making decisions How many people are involved How quickly agreements are made
Communication Written Different means viewed in various ways Spell out dates, currencies and temperatures carefully Must ensure technology is in working condition Verbal Many cultures view this as the most important means Understand how to communicate names and titles Double check common phrases of the foreign country Check translations a number of times to confirm accuracy
Communication Body Language Very easily misunderstood Some gestures read in contradicting manners To avoid confusion, repetition verbally might be necessary Colours and symbols have various connotations
Social Relationships Considered standard practise by cultures heavily influenced by family or other social groups Remember to; Adhere to their norms of social behaviour Meet outside of office hours if they request it
Greetings Can be of various gestures (hand shake, hug, kiss, bow, etc.) Eastern and Western gestures are sometimes combined (shake hands and bow) Can create tension and awkwardness if no one is aware of cultural expectations
Manners and Etiquette Table manners The left hand is considered “dirty” in many Asian, South American and Middle Eastern cultures – don’t use it to eat Punctuality Asians like to arrive early Latin Americans are usually late Business cards Be aware of design (colours, images, etc) Write in both English and the foreign language Generally should be given with both hands Read a received card before putting it away
Bribes and Gifts Seen as either common practice, expectation or inappropriate behaviour Before entering the country, check; Is gift-giving appropriate or offensive? What is the appropriate value/cost of a gift? What items are unacceptable? When should it be given? How should it be wrapped/presented? Sometimes a personal favour is completed instead
Religion Governs many areas of society Influences working hours national days of rest attire and behaviour gender and role issues
Cultural Differences in the Business World Impact Real Estate May 2005