Importance of Understanding Cultural Differences in Business

Management and Organizational Behavior

Management and organizational behavior
Discuss why an understanding of cultural differences is important to
business. What are some steps that managers can take to develop
greater cross-cultural awareness?
In the present business world, it is important to have proper understanding of the cultural
differences. If the business have proper understanding then it can be easy to manage the entire
operations of the company. The importance of culture in the business environment is an essential
step towards achieving success and growth in the global market place. To operate the business on
the worldwide platform it is necessary for the business to have proper knowledge of the cultural
difference so that it can be easy to accomplish goals and objectives. In this essay, the discussion
will be made on the importance of understanding cultural difference for business and also on the
steps that should be considered by the managers to enhance cross cultural awareness.
If business have proper understanding of the cultural difference then it can be easy for
them to enhance the satisfaction level of the customers. The customers can be satisfied if
companies try to focus on their culture and provide services and products accordingly. By
knowing the culture, it can be simple to business to offer the products and services according to
the needs and wants of the customers. It shows a direction to fulfill the demand of the customers
in the global platform. It directly gives impact on the entire sales of the company. By
understanding the culture the company can easily enhance the satisfaction level (Bisk, 2018).
It is also necessary for the business to have proper understanding of the cultural
difference as it helps to foster the communication process. By focusing on different culture it has
been seen that communication process can be easy for the business. In different cultures
languages are also different. So, by knowing the overall cultural pattern it can be simple for the
business to communicate effectively. Business can easily analyze that how individuals in the new
market use words and phrases, body language and other cues to communicate. By having proper
understanding the business can reach to their target customers and can convince them to
purchase the products and services (Binder, 2016).

Management and organizational behavior
Therefore, through this it can be stated that it is important for the businesses to have
proper understanding of the cultural differences as they can consider the effective strategies to
grow in the market.
Having proper understanding of the cultural difference can help the business to consider
those decisions which are beneficial for them. If business does not have understanding of the
culture then it can be difficult for them to take decisions (Fay and Larson, 2016).
For example: If the company wants to enter into the Australian market, then should have
proper knowledge of the culture which exists in Australian market. By knowing the culture they
can consider the strategies which will help to grow in the competitive market.
Also the company who is planning to expand the operations in the international markets,
it is necessary to understand and appreciate the culture of the individuals with whom the business
will be conducted. The company can easily earn profits and achieve success if they have proper
understanding about the culture difference. Therefore, it can it can be stated that cultural
difference understanding can show the business right path to operate the activities of the
company. It will also help in achieving competitive advantage in the market (Tjosvold, 2017).
There are also various steps that should be considered by the managers to develop greater
cross cultural awareness. One of the step on which focus should be given by the managers is
related to communication. It is important for the managers to improve the process of
communication. By having effective communication process it can be simple for them to have
clear interaction and to share the recent updates (Welbourne, Gangadharan and Sariol, 2015).
By having proper communication process the managers can easily convey the updated
information by involving the employees of the firm. Cross cultural awareness can also be
enhanced. Also through proper communication in the workplace it can be easy for the individual
to know about the values or beliefs of the different people. By interaction only one can gain
proper knowledge of the values and beliefs of the other individuals (Ruesch et al., 2017). An
effective communication can help to enhance cross cultural awareness. Managers should
communicate with the employees so that they can easily gain proper information and can be
aware about the cross cultural awareness (Hopkins, 2016).