Cross cultural business provides a
global platform for an organization and effective team for cross culture can
enhance the organization’s competitive position by using innovative ideas and
using different experienced persons thinking.Although cross cultural business play
an important role in any organization but cultural differences are also exists in
these organizations and these cross cultural differences can interfere inexpanding
the projects in other culture or other countries with different culture.For
this managers of organization should promote through motivating and leading the
people using creative ideas. These cultural differences may exist in the form
oforientation of motivation, defining others and interacting with others, time attitudes,environmentalattitudes,risk
orientation.
Three Major
Cross Cultural Differences in US & China:
The culture in US and Asian country
china is different in various aspects and this cause cross cultural differences
like in US culture; colleagues attend the official parties so
that they can interact with each other and get to know about each other on a
personal level and many people don’t want to interact with each other and don’t
want to club their professional and personal life. On the other hand Chinese, first
foster trust on those with whom they are doing business as in Chinese
culture, trust play an
important role in building confidence which is essential to run a business
smoothly(Amadeo, 2014) . Managers of
organization should promote through motivating and leading the people using
creative ideasso that these cross cultural differences can be avoided and
abolished. These are some of the cross cultural differences that should be
considered while expanding the business in other cultural business:
·
The
first cross cultural difference is the relationship between people, the
organization should take care the people and organization as customers play an
important role in any business so they should maintain a flexible relationship
with the people of other culture where they are expanding their business.
·
Style
of communication is also a very major cross cultural difference that may create
distraction between the two businesses of different cultures. One should keep this
cross cultural difference in mind while expanding their business in some
different culture.
·
The
third cross cultural difference may be moving in different pace. As the taste
and preferences differ from culture so the technique and pace of moving may
differ from culture to culture and this should be a priority as to satisfy the
needs of people in different culture where they are expanding the business.
Four P’s in US& China:
|
Basis
of Comparison
|
United
State
|
China
|
|
Product
|
More
capital abundant country
|
Less
productive
|
|
Price
|
Prices
in US are higher and competitive
|
Under
different market segments
|
|
Promotion
|
Deals
with only urban population
|
Deals
with both rural and urban population.
|
|
Place
|
Stronger
distribution channels
|
Simplicity
in supply chain management
|
The
above table shows the four P’s of US and China. There are differences in these
four P’s those are product, price, promotion and place, in both the countries
as there are cultural differences in the countries (Waterschoot & Bulte, 1992) .
·
Product: as the United States is a more
capital abundant nation and more productive country than China so the United
States can be expected to export products that are different from China’s
products.
·
Price: in case of china the
prices are under different market segments, competitive conditions and
location. In case of US prices are very high and competitive.
·
Promotion: in case of China promotion
is based on personal selling in rural vs. urban locations. In case of US they
deal with urban population only.
·
Place: the distribution channel of US
is stronger than in China because of the geographical differences. US involve
more mediators in supply chain management whereas China has simplicity in the
management of SCM (Amadeo, 2014) .
Ethical Issues of
China:
As US is expanding in China so they
should understand and respect the ethical issues to avoid the cross cultural
difference. Some of these are:
·
Labor and environmental standards in china:
Chinese follows a rigorous standard practices with respect to the labor, they
follow the laws governing the issues related to the labor practices in the
organization or workplace, so US should understand and respect this.
·
Intellectual property protections in
China: there are some intellectual property protections in China that deals
with the framework that has been established for the sake of protecting the
foreign as well as local properties in terms of issuing trademarks, patents,
logo’s etc. so US should understand and respect this (Tam, 2002) .
Conclusion:
So
this can be concluded that the US can expand their business in china by
adopting these strategies to avoid cross cultural differences; cross
cultural communication,mutual respect and culturally-aware leadership.
References:
Amadeo, K. (2014). China's
Economy. Retrieved from About.Com:
http://useconomy.about.com/od/worldeconomy/p/China_Economy.htm
Tam, O. K. (2002).
Ethical Issues in the Evolution of Corporate Governance in China. Journal of
Business Ethics , 303-320.
Waterschoot, W. v.,
& Bulte, C. v. (1992). The 4P Classification of the Marketing Mix
Revisited. Journal of Marketing , 83-93.
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