Cultural Issues in International Organizations - Essay Example

? Cultural Issues in International Organizations Task: Cultural Issues in International Organizations Cultural issues have animplication on the international management practices (Raoprasat & Islam 2010). Culture is the way of life of a particular people. It consists of knowledge, belief, thoughts, morals, traditions and practices acquired by a person by virtue of being a member of a given society (Nunez et al. 2007). Several cultural issues affect international business. Before any firm decide to venture into business, it is prudent to understand this diversity (Onkvist & Shaw 2008). The purpose of this document is to evaluate the impact of cultural issues on the international organization. The foremost part of the chapter evaluates the extent to which cultural issues may impact upon international management. The second part evaluates the extent to which cultural issues impact upon selling strategies in international commerce. Included in this document is the global nature of current business organizations and the location factors that affect international operation. In addition, resource management issues and their impact on the international market are discussed about. The last part of this document looks at the theoretical models and complex issues associated with management of international organization. Globalization is taken to mean internationalization. It has led to instantaneity, where things happening in a given location, in the world, can be experienced all over at the same time. This has been made possible through breakthrough in technology and the removal of restrictions that bar associations between different countries (Sandy & Thomas 1997-2009). Globalization led to easy exchange of ideas, knowledge, goods and services. It has made investments, exchange of money and merchandise possible across borders. This process has led into an open world economy. According to Ray (2007), globalization is that which increase the extent of economic activity, international firm cooperation and easy and quick information flow. The current business organization have certain characteristics in common, to start with, there is diversity in international organizations. This diversity is both inside and outside the organizations. Internally managers must respond to diversity in the HR pool, much difference in management system, diversity in means and ends including financial objectives to, advanced broad view, and adoption of a variety of models for a variety of business units (Kvint 2009). Externally the organization, there are diverse customer needs; myriads cultural values; an excess of stakeholders; different political, economic and legal provisions; and different competitors schemes. Another nature of the current global organization is interdependence. There is a web of interdependence in finance, governance, management, supply of goods and services, security, communication and transportation. Interdependence accelerates globalization, but it has many challenges associated with it, a break in the chain of flow can be devastating (Amann et al. 2007, p.5). There is the element of ambiguity in the business world today. There is a large amount of information with little clarification, making digestion and execution of appropriate action a challenge. For example, there is a range of accounting standards making monetary figure vague. Research is becoming unreliable due to the uprising of uncertainty. In addition, there is the issue of flux. The global companies are faced with unexpected changes. The more international the organization is the more prone it is to change. Managers should take precautions in order to avoid negative effects of change. Some cultural practices have an impact on communication; this has made international collaboration difficult. Exchange of knowledge, skills, goods and services between organizations across borders is possible if, they are simple, to the point, independent and involve similar cultural contexts. In contrast, it is difficult to share such knowledge of societies with large cultural differences (Geiersbach 2009). Some cultural issues that influence international organizations are discussed below. To start with, the languages difference among international communities can breach communication rendering any transaction among them impossible. It is advisable to localize materials when faced with this challenge. However, care should be taken when translating words. This is because some translation may be offensive to the natives. Behaviours and gesture viewed as fitting in one culture can be offensive to individuals from other cultural settings. It is of much value to gather knowledge on communication techniques and meaning of orientations and gestures of the host country, before venturing into international business. The second issue is the individualism verse collectiveness. Some societies such as the Asians believe in collectiveness. Decisions are made and executed in groups, there is loyalty among groups, and everything is done to great advantage of its members. On contrary western countries, such as America, have a strong believe on individualism. A personal opinion determines the course of action. Cooperation is viewed as a limitation. Third is the culture of cooperation. While some community put more emphasis on the good relationship shared between its members, others stress on contracts. Africans, for instance, pay more attention on the relationship they share with their partners. The bond determines whether they will play their part to the end. On the other hand, Americans prioritize contracts. This agreement binds the parties to do their duty (Becker 2000). The fourth factor is the risk taking issue. This differs from one society to the other. Americans, for example, are reluctant at taking risks. They rely on scientific research to determine the feasibility of the situation, before making any venture. Conversely, other societies, such as the Asians, have risk taking tendencies. This is because they view researches as a waste of money and resources. The fifth difference is in the masculinity verse femininity. While some societies opt for feminine way of tackling issues, others stand for masculine methods. In femininity way of solving matters, people tend to rely mostly on feelings, negotiation and compromise. This is evidenced in Asian societies. In comparison, Chinese prefer masculine stands. Hard stands are taken based on reasons. There is no room for compromise and negotiation. Sixth point is the personal relationships at work. Asian, for instance, value personal relationships. This extends to the places of work. They work in groups as their culture dictate collectiveness. Europeans and Americans value individualism. Their managers discourage interpersonal relationships in business. However, group members are allowed to learn from one another. Seventy differences are in the values the societies hold. Western societies, for instance, value freedom and personal sense of right and wrong. In addition, family, class, and occupation are of importance to them. In contrast, African society values are security and obedience. Frame groups make meaning to them. Eight is the view on human nature. This is concerned with the fundamental nature of human beings. Some culture belief that the fundamental nature is not inherent, and a child is born a blank slate. The environment determines the kind of the person one is going to be. This is mostly held by western cultures. This is the focal point when it comes to socialization and rehabilitation in these cultures (Seltzer 2009, p.22). In some culture, it held that people are inherently good. A person is trusted until he shows abnormal behaviours, upon which he receives punished. This is the perception held by Islam. In other culture such as the one held by Christians, people are inherently bad, and people should keep on guarding themselves against their natural tendencies to commit evil. There is a difference in the view on time. Some culture sees time as monochromic, with equal intervals. This is the view held by industrialized countries. Activities are measured and planned using these equal segments of time. They believe in tackling one task at a time. Cultures with monochromic view differ in orientation. Some have past orientation; they consult the past to solve present problems. Culture with present orientation solves current needs and those of the near future. They struggle to keep pace with modern times. Time is viewed as scarce. On the other hand, cultures with future orientation give a lot of consideration to the far future. Sacrifices are made in present times for the sake of the future. In contrast other culture view time as parallel. This is the polychromic cultures. Time is taken to be in a lot and flexible. People tackle a myriad of activities at the same time. These individuals take clocks and calendars as an estimate of time, and they do not firmly obey them. This is the view held by African cultures (Larry et al. 2007, p. 154). In addition, some countries have twin religious and civil systems. For instance, in Muslim countries legal contracts may vary depending on the religious bindings. With connection to this point, is the gender issue. Firms from UK and US put emphasis on equivalent opportunities for all, regardless of whether the sex. This is reflected in the manner in which they assign duties and positions. On the contrary, in Muslim dominated nations, little attention is paid on women. Senior management positions in such nations are given to men (Stahl 2006) Social cultural issues determine consumer and buyer choices. This in turn, can influence the marketing strategies. Translation of advertisements to different language can change its meaning. The manner in which a culture is structured can evoke different views on the product in the market. A research carried out by Toys R US found that cultural background determines consumers’ choices. TVs and movies when choosing toys influence children from US. Those from Japan generally prefer electronic toys. On the other hand, children from Asia go for educational toys (Anup 2010). There are five levels of culture that one need to put into consideration. A national level, which forms fundamental assumptions, a regional level whish influence our belief. Culture is not homogeneous it differ from one country to the other. However, it should be added that culture is never static; it keeps on changing with time. Various cultural components have a direct influence over the international marketing. First is the educational component. The level of fundamental education in a foreign market influences the targeted customers. The level of literacy has a direct influence on how products are marketed. In countries with low literacy level companies use printed forms of advertisements while, in highly educated countries, training and oral means of transmitting information are used. The second cultural issue that affect marketing is the social organization. This deals with the way the society considers personal relationships, structure of social institutions, and social classes. In some societies, women lack social status and opening market for feminine products in such places would not yield a lot. This is the case with the Indian caste system. Third is the issue of law and politics. In many nations, legal matters and politics are influenced by the culture of the people. These factors in turn can affect marketing strategies in those countries. Politics and law may impose restrictions on marketing strategies (Czinkota et al. 2008). This is the reason why Orange Mobile Phones faced difficulty in Ireland when they advertised there product with the words `Future is bright the future is orange.’ Fourth is the aesthetics issue. This is a cultural view of beauty. Firms should ensure that designs, colours, music, product names and language of communication are appealing to the local culture. It was difficult for Peps dent to sell its product in East Asia because the adverts said the toothpaste makes the teeth extra white. The native considered blackened teeth as beautiful, therefore, avoided the toothpaste. The people on values and attitudes hold the fifth point. The importance people in a given area place on factors such as leadership. Responsibility, time, money, work and leisure have effects on the products in the market. In developed countries, there is an inclination towards products manufactured at home (Samiee 1994). In these countries, homemade products are considered safe and standard. In 2006, China barred a Nike advert that pictured a basketball star fighting kung fu masters and dragons, since it was contrary to their values and attitudes. Sixth is the cultural learning process. People learn their own culture in various ways. Some learn it formally from family members; others learn it technically in schools and the last category learn if informally from peer groups, adverts and other market-related means. The culture learning means, determine patterned way people follow when buying new things. Religion can also affect marketing of products. In 2007, China banned all advertisements containing pig images. This was a gesture of solidarity to Muslim society, which constitutes 2% of its population. In Arabic countries, adverts on pigs and its products are not allowed. It is upon the marketer to determine adverts that may be offensive to a given religion and avoid them. Resource management is one of the major challenges facing international business (pennypacker 2007). This may range from insufficient resources to fierce disagreement associated with resources. The most noteworthy challenges in resource management include poor resource capacity planning, lack of adequately skilled resources, too much demand on available resources, inadequate use of available resources, and poor estimation of resource use. Some disagreement can arise when firms over exploitation natural resources in the host country. There was a fierce disagreement between Zimbabwe government officials and the west because the native felt that their natural resources were being over exploited to the advantage of foreign investors. Employment issue has been the source of managerial problems. In some countries, there is a lack of skilled personnel to deal with various issues. This is mostly evident in developing countries. However, in developed countries, there is an influx of skilled personnel. It is difficult to choose the right person to occupy organizational positions. In addition, there is the issue of under payment by some firms, this demoralise workers leading to low outputs. Some firms employ citizens from their home country in key positions, leaving manual jobs to the host compatriots. Such actions have resulted in bitter disagreement between the two-partnered countries. Some firms have contributed to environmental degradation in the host countries. Mining companies in Tanzania left open mines, which are hazardous, to the environment (Dhar 1996). Human resources can also be a challenge for managers. These challenges include change in management; this can be a problem if there is the lack of experienced personnel to occupy the positions left vacant. Leadership development is a challenge to human resource management. There should be regular training of leaders to equip them with relevant knowledge to deal with organizational problems. However, this is not always the case due to lack of initiatives and sufficient funds. This has contributed to some of the major mistakes committed by companies, when they face challenging situations. Lack of appropriate tools to measure human resource effectiveness has been a challenge for most companies. Managers face the challenge of determining contributions made by different types of human resource. Due to this fact, there has been difficult to trace transaction management and positive contribution of various resources. In additions, there are challenges associated with compensation, staffing, succession planning, learning and development and benefit costs. There is a difference in the way management practitioners and theorist gather information. The result leads to the difference in design and utility of information systems. There are different types of theoretical models that are applied in international management (Welee 2009). The first is the information accumulation model. The model identifies the collective manager traits together with the organization culture and their influence on information environment. Information environment has an effect on individual manager performance. It has two approaches; systematic approach, which assumes that information, wanted, is clear and understood. The intuitive approach is used when the information is not clear and is naturally not linear. From this model, managers can obtain very clear information (Salzmann 2008). The second model is the systematic approach. It commences with a problem and a call for information. The managers seek information to get a solution to the problems. This is done through gathering of information. Members within the organization cooperate in gathering relevant information. The manager uses this information to make decision (Cheung 2007). The third is the intuitive approach. It suggests that the availability of information, despite of a clear need for this information, is an incentive that motivates the gathering of information. Certain schools of thoughts explain how to deal with cultural diversity. The first one states that business are business everywhere all around the globe. Using this school of thought, one has to ignore cultural differences when doing business. The second one states that companies must adapt business to individual cultures (Weber 2010). This recognizes the influence of culture on business. The key challenge of doing business internationally lies in the abilities of the managers to adapt to a myriad of cultures. Such adjustment is possible if one has a deep understanding of cultural diversity, ambiguity and cultural flux (Granell 2000). As it is mentioned above, there are many approaches which can make management of international business possible. These include information accumulation approach, systematic approach and intuitive approach. It should be noted that none of them is superior. The appropriateness of the model depends on the prevailing situation. For international managers to succeed, they need to have a wide range of knowledge on issues that impact upon global organizations. They need the ability to mobilize, organize and maximally utilize resources for utmost benefits of the firm. However, when using the available resources, precautions should be taken by management to avoid misunderstanding that may arise between the involved parties. Managers should learn, and appreciate the existence of different culture all across the globe. Above all, managers need to be informed and flexible. Situations keep on changing and this call for open minded persons who are ready to accept and use new and appropriate ideas to deal with emerging issues. References Guinter, k & Ingma, B 2006, Handbook of research in international human resource management, Edward Elgar, Northampton. Raopraset, T & Islam, M 2010, designing an efficient management system, Springer, Berlin. Onkrivist S & Shaw J, 2008, International marketing: strategy and theory, Taylor & Francis, New York. Nunez, C, Nunez, R & Popma, L 2007, Intercultural Sensitivity, Uitgeverij van Gorum, Netherlands. Granell, E, 2000, Culture and globalization: a Latin American challenge, industrial and commercial Training, vol. 32, pp, 89-93. Terpstra, v & Sarathy, R 2000, International Marketing 8th Edition, New York, Dryden Press. Cheung, C & Ko, k 2007, `Systematic knowledge auditing with applications`, Journal of Knowledge Management Practice, vol. 11, no. 4, pp. 140. 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