Managing Cultural Differences – Valley International Association Newsletter, February 2007

The globalization is being fueled by advances in information technology, new international trade agreements and the growth of international trade. We live in an inter-connected world that has an integrated economy. We may not travel around the world to conduct business, but we are still constantly affected by global issues and continuously deal with people from different cultures. People in the business industry who possess cultural competency can gain tremendous advantage in the competitive global market.

Knowledge about different cultures helps us to understand what makes people unique in terms of their customs, traditions, values and beliefs; everyone has different attitudes and concepts, hierarchies and roles, time and space relations and both verbal and nonverbal communication processes.

The important step to developing cultural awareness is to understand the main characteristics of our own culture. We as Americans are different from others. For example, we say that time is money in our business relationships. However, in Middle Eastern and Asian countries people invest considerable amounts of time in friendly conversation and friendships before going into their business agenda.

Believing that people think the same way around the world is a problem, and is a barrier to emotionally connecting with people. A good example is Stephen Covey’s book, “Seven Habits of Highly Effective People”. It was first published in Japan, and sold less than 5000 copies. Given that it was a number one best seller in the U.S., many observers were surprised. In his analysis of the problem, Covey’s associate pinpointed that it was because of the specific translation of the book. A virtually direct translation of the book had been made from English to Japanese, due to the belief that what worked in the U.S. would work just as well in Japan. After the discovery that this did not work, a new culturally-aware translation was then commissioned. Instead of a literal translation from English, the book was reworked to convey meaning in a style that fit the Japanese ways of thinking. This new version sold over 500,000 copies, and for a period of time, it was the number one best selling book in Japan.

Cultural competency encompasses three elements:

  • Cultural awareness. This involves understanding one’s culture and how it impacts the thinking and attitude of the people.
  • Cultural sensitivity. This is the ability to respect cultural differences.
  • Developing the right attitude to respond to different situations.

When companies export overseas, the executives need to take into account these cultural factors. Therefore the global strategies must incorporate the local culture into product design, marketing, manufacturing and sales promotion to achieve success in foreign countries.

Some Useful Internet Sites

The information provided in the list can include some bias factors due to the fact that it was written by Western sources. We need to combine the data with local sources to get a more comprehensive view of cultural matters.

1. Country Background Notes (U.S. State Dept)

2. Country Commercial Guides (U.S. Dept. of Commerce)

3. Briefings

4. International Monetary Fund (IMF) Country Information

Ayse Oge, President of Ultimate Trade, International Trade Consulting, Speaking and Training E-mail: Phone: 818-708-9571