International business culture

In business the key to become internationally is to understood the role of culture while doing
business internationally . for whatever sector or business they are operating in , there is a impact
from cultural difference to the profit of company . by improving the awareness and knowledge of
international business can aid in growing the business and facing international competition and
gaining competitive advantage . to be aware of cultural difference of different countries , but its
also hard to be aware of every single aspect of each country In the organizational
Communication is essential in business to exchange the information or to direct the employee
nor team to do certain task , whether you do nationally nor internationally , but it becomes more
barrier when you do the business internationally due to language barrier it’s the reason some
company training the employees to learn the language nor jargon to get effectiveness in their
work . by Being aware to the customer need and this will give the customers attracted to your
product or service in simple term if he is aware of the customer cultural background the company
able to make better advertisement .

The concept of culture

Many expert in their field has define some concept about culture . the concept of culture is varies
in the concept based on their analysis of social , physicological , linguistic data etc, although
acknowledging multiplicity of culture is not enough due to culture can be change . culture define
as collective programming of the mind which distinguish the member of one human group from
another . each culture has three layers outer layer such as behavioral or explicit level , second
layer such as norm and value and last layer core of culture contain its assumption and its belief .
culture can be influence by politic nor norm and value its obvious when bringing to global unity
to humanitarian norm and value .

The institution that can contribute the establishment of the national culture
A) family : as the basic social unit whereby acculturation takes place , where the culture
of particular environment is instill from infancy
 B) religion : religion belief can have significant effect on the person perspective toward
world , it does not mean people have to belief but religion has help in all scope in direct
or indirect ways to shape the environment in which people live .
C) education ; the value I n which education are based on curriculum and help formation
of culture . particularly when the educational institution are well developed . the manner
of learning also affect the future learning
D) mass communication media : mass communication is impact to people brain to see the
world and bias is growing due to changing the information to manipulate people .
E) the multinational company : this consider as powerfull culture building institution
whose product and service can influence the way people are living , and the operation can
affect how and where they work . however , the multinational also influencing by the
preference the national level with regard to the service or product taste .

Due to cultural difference in the world , organization or MNCs are responsible to understanding
of cultural influence to the behavior and people effort to contribute to the corporation , if
manager has no idea about the culture difference then it will lead to disaster of its company .

These are the main challenge for company which are doing business internationally to adapt and
aware of the culture difference , such as require to acknowledge the diversity of cultur , the
perception , value and cliché , to be integrative studies has revelead the linking dimension of the
behavioral and culture in international culture , cultural can influence smoothing the business in
developing country , emerging, or developed country . .
 Here are the characteristic of cultural

A) change in generation : culture is eveloving from generation to generation

B) divided : the culture can be divided in a member of organization or cultural division in
society
C) symbolic ; the culture can be based on human capacity to sort or use to define
something else
D) learned : culture can be learned by experience cause its not inherited by biological
nature .
E) exemplified ; culture had structure , can be change of one part willing bring change in
other part
F) adjustment : culture based on human capacity to adapt in their environment and can be
change .

When doing business internationally , communication is essential for the company and lead to
successful execution in daily operation , by understanding culture difference and deal with
language barrier company may become smoothly in their operation , some business is looses due
to the parties did not learn about the difference of the culture while doing in other country .
Case of BMW currency exchange risk .

BMW is Germany luxury vehicle which produce automobile or motorcycle manufacture , due to
globalization which eliminate the barrier in business and support by many organization such as
NAFTA , ASEAN , UN and many others , this company began to take the advantage of
localization in many countries , the car sold in Germany just cover 17 percent of market share ,
china has lead and become the fastest growing market for BMW car for about 14 percent in 2011
and followed by India Russia and eastern Europe . BMW facing challenge while doing in other
country which is risk of exchange rate currency and it impact to rising sales revenue for BMW
company , BWM knows the profit was severely erode by the change in exchange rate , as a result
negative effect of the exchange rate totaled €2.4b in 2005 to 2009 . BMW refuse to increase the
price as the strategic to deal with this problem.

There are two strategies taken by BMW to solve this issues which is natural hedge meaning it
will spent the money in the same currency in the place where the sales taken place , the meaning
that revenue will gain in local currency . however this strategic may offset so this company is
deciding to use formal financial hedge, BMW set up regional treasury center in US , Singapore
and UK. BMW was implementing this strategies , the natural hedge strategy used in two ways ,
first involved in establishing factory where the product is made , and second is involved made
more purchase denominated in the currency of the main market , by the this company own 13
production activities in 13 countries , production volume approximately 20 percent of the total ,
and increased to 44 percent . BMW had become the first premium carmaker from overseas to set
up a plant in US. BMW announced investing $ 750 m to expand it Spartanburg plant . it makes
this company created 5000 job in the US and cutting jobs in Germany.
Reference

Roger E. Axtell, Do’s and Taboos Around the World (Hoboken, NJ: John Wiley & Sons, 1993).

Sanjyot P. Dunung, Doing Business in Asia: The Complete Guide (San Francisco: JosseyBass, 1998).

Edward T. Hall and Mildred Reed-Hall, Understanding Cultural Differences (Boston: Intercultural Press,
1990).

Geert Hofstede, Culture’s Consequences (Thousand Oaks, CA: Sage Publications, 1984).