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Updated on: 22nd Feb 2021

Impact of Cultural Norms on Global Business Essay Sample

In this sample essay, we will be discussing the impact of cultural norms. As we know global business transcends the limits of nations and interacts with many cultures. Therefore it is necessary to understand the needs of each culture and the proper way to interact with them. This needs to be done in order to make a successful business.

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Therefore, we shall be looking at the different aspects of the impact of cultural norms. So topics of our discussion will be: what are cultural norms, why are global business affected by cultural norms, and the way cultural norms. Furthermore, we will be looking at five different ways in which cultural norms affect international business.

What are cultural norms?

Cultural norms are rules, or excepted behavior based on which a culture guide and judge its members. Moreover, these rules and expectations are based on the shared beliefs of the given culture. Nevertheless, cultural norms vary highly from culture to culture.

In fact, cultural norms may be considered the key identity of a culture. Plus, these norms affect the members of culture greatly as their lives are based on these.

Why is global business affected by cultural norms?

As we know global business work across many countries of the world and each country have their different cultural norm if not multiple. Hence naturally they come in contact with many different cultures. Even though this interaction is willful, sometimes it creates challenges.

Therefore, in order to conduct their business successfully, these companies must adapt to these cultures. Moreover, each culture has a different view, morals, socially accepted behavior, and set of rules. Meaning that an international company cannot treat every culture in the same way. On top of that, some countries are quite diverse and culturally rich which adds to the problem of international business.

As a result, we can say that cultural norms have a high impact on global business. In fact, it even forces companies to change strategies campaigns, and policies from culture to culture.

Nevertheless, we shall discuss all the different ways in which cultural norms affect a global business.

Ways cultural norms affect business

Cultural norms have several effects on a business. Ranging from changing strategies to patterns and more. Nevertheless, in this section of this essay, we shall discuss all the different ways in which cultural norms affect international companies.

These areas mentioned below:

  • Negotiating goal
  • Negotiating attitude
  • Communication
  • Form of agreement
  • Risk-taking

So these are the 5 ways cultural norms affect global business. Moreover, we shall discuss these ten points in brief below.

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Negotiating goal of a culture: Contract or relationship?

People from different cultures may interpret the purpose of a negotiation differently. For negotiators from a certain culture may prioritize signing a contract. Whereas a dealer from another culture believes that goal of negotiation is starting a relationship between two sides.

Therefore, global businesses dealing with different cultures must anticipate the type of negotiation. Moreover,   if a company enters a negotiation with the wrong strategy it might hamper the cause.

Negotiating attitude of a culture: Win-Lose or Win-Win?

Similarly, deal makers from different cultures may enter negotiations with a different attitude, A person from a certain culture might prefer a win-win deal, whereas another person from a different culture might enter a deal with a win-lose attitude.

A person with a Win-win attitude enters a meeting as a collaboration between two parties where they both benefit. Whereas, win-lose is more confrontational.

Communication in different cultures: Direct or indirect?

Certain cultures rely on a direct form of communication whereas others prefer an indirect form of communication. Moreover, this could be a deal-breaker as a culture with direct communication might interpret its counterpart as insensitive and ignorant. On the other hand, indirect cultures may understand direct communication as aggressive and impatience.

On top of that, interaction is totally dependent on communication. Hence, making it a decisive factor.

Form of agreement: General or specific?

Previously we read the goal of negotiation. However, regardless of goal almost every culture prefers a form of a written agreement. Nevertheless, some cultures might prefer a highly detailed agreement in which every situation is mentioned no matter how unlikely. On the other hand, certain culture prefers agreements mentioning basic governing principles of the deal.

Therefore, providing the right deal maker right written agreement is very much necessary. Again while entering a negotiation one must know what they are dealing with in order to be at a favorable end.

Risk-taking: High or low?

Obviously, depending on the culture some dealmakers are more willing to take part in risky deals. In comparison to that other culture’s deal maker might not want to take part in a risky deal.

Therefore if a deal seems a risk to a cultural deal maker he or she might not want to invest themselves in it and hence break the deal.

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