Effective implementation of International Financial Reporting Standards (IFRSs) in different countries is not an easy task. Poor infrastructures as well as internal influences are one the causes that have lead….
Cultural dimesnions international managment
Business thrives everywhere whether it is in a remote place somewhere in the southern tip of the islands of an Asian country or the tribal villages of the African continent. This is not the same however, with the kind of business done in these and other countries whenever the multinationals are concerned. The exchange of skills and global relations at the same time is also happening right now in these very places. Where offshore outsourcing is involved, China is perhaps the most known illustration of what it means.
In countries like India and the Philippines, Call Centers, for instance, an industry virtually unknown five or ten years ago has become the source of income for the average fresh graduate with a four or five – year degree. Picture an Indian or Filipino catering to customers or clients from places that generally, they cannot even imagine or in many cases, they have only seen in movies and are mentioned in the evening news.
In other occasions, a scenario such as Americans buying and enjoying things and gadgets by bulk at such amazingly very low prices, all with tags “Made in China” is however, no longer new. Who can probably resist a very cheap cost of otherwise expensive items when the tag indicates a product made in the U. S. A.? These are pictures of cultural distinctiveness and their impact on global management. Culture is defined by author Schein as the “learned, shared, tacit assumptions on which people base their daily behavior” (1999).
Anyone wanting to stay on top of business and remain competitive will have to thoroughly be acquainted with specific behaviors, attitudes and values inherent in every business institution or establishment distinct even from the cultural trappings or externals that are uniquely present in every race, nationality or religion. In fact, according to Schein, the manager or owner must understand that these maybe flimsy, whimsical and fleeting at times, and are influenced by a lot of factors in both the internal and external environments (Schein, 1999). Values and attitudes are similar but not the same in this context.
Attitudes are tendencies that are apt to be displayed and manifested by people and are hugely influenced by the values that these people hold. For those individuals or corporate people in a hurry to make it to the top and do not take time to study these ingredients in their specific set-up or settings will find out later the cost to the decisions not to make a careful research on this important organizational or global essential which is culture (Schein, 1999). How do values, beliefs, and attitudes differ? How do they influence international managers in their decisions?
Since globalization has become the common trend among nations when it comes to trading different products catering to different needs of the global community, it is expected to be at the forefront of any business dealings around the world. Because advertisements of lifestyles as well as foreign products are frequently watched and read and heard in the media, nations that were separated and estranged from other nations three or four decades ago, are now made into one global community largely because of the current advances in technology (Jana, 2001).
Today, gadgets, clothing, and accessories being used by celebrities can now be possessed by the general public. As business magnates have been keenly aware of the worldwide clamor of people for certain products, they automatically had taken advantage of the opportunity and made use as well of the international man-power that is readily available to meet this universal market. Imagine the discrepancy when it comes to the cost of work done by an American citizen regarding IT work: US$ 100 an hour, as to an Indian counterpart worth only US$20 per hour (Overby, 2003).
No wonder, owners of many IT companies, in many cases, bring the job elsewhere rather than give it to people at home. What steps would you recommend to someone preparing for an overseas assignment that would help that person adapt to an unfamiliar cultural environment? Someone preparing for overseas assignment must be acquainted with specific cultural differences that can only be gained from closely studying some people who come from the specific or particular place.
If this is not possible, it may well be that sources such as Geert Hofstede™ Cultural Dimensions be utilized to get glimpses of the culture of the country and/or place of destination. It is a very complicated matter when one is making decision to operate in another country very foreign to one’s own. What must be studied are the business practices that are common to such a place, legislation or policies that are pertinent to the existence of the business operation; and the local culture, their people and unique ways of looking at things as well as how they treat foreigners are just some of these factors to consider seriously.
“BUSINESS organizations must be well versed in the complexities of international transactions or must have assistance in extensive experience assisting overseas businesses establish operations” (http://www. geert-hofstede. com/hofstede. shtml). Reference 1. Jana, Reena. 2001. The new brain game –H1-workers-Industry or Event. Industry Standard. Accessed July 15, 2008 <http://findarticles. com/p/articles/mi_m0HWW/is_1_4/ai _68547118> 2. Overby, Stephanie. 2003. The hidden costs of offshore outsourcing-offshore outsourcing the money.
CIO. Accessed July 15, 2008 <http://www.cio. com/article/print/29654> 3. Overby, Stephanie. 2007. ABC. An introduction to outsourcing. Everything you need to know to avoid the pitfalls of outsourcing. CIO. Accessed July 15, 2008 <http://www. cio. com/article/print/29654> 4. Schein, Edgar. 1999. The Corporate Culture Survival Guide. Jossey-Bass; 1 edition. 5. ______ Offshore outsourcing: what’s working, what’s not. A. T. Kearney, [email protected] Accessed July 15, 2008 <http://knowledge. wharton. upenn. edu/index. cfm? fa=viewA rticle&id=1102&specialId=25> 6. http://www. geert-hofstede. com/hofstede. shtml