Intercultural Competence in Business

This report explores the significance of intercultural competence in business and provides insights into cultural frameworks and communication theories. It includes case studies of Frank and Anna, who face cross-cultural challenges in their business ventures. The report offers practical advice on enhancing interpersonal communication and adapting to different cultural contexts.

INTERCULTURAL
COMPETENCE IN
BUSINESS

Table of Contents
INTRODUCTION ..........................................................................................................................2
TASK..........................................................................................................................................2
Divergent Cultural Frameworks..................................................................................................2
Application of the frameworks to realize distinct interpersonal communication in official
situations.....................................................................................................................................4
Application of Intercultural Communication theories to adopt in different business scenario...6
CONCLUSION ...............................................................................................................................7
REFERENCES................................................................................................................................8
INTRODUCTION
The two major drivers for international business comprises of technology and Globalisation.
Companies go international in order to earn high profits, brand image and increase in its sales
generally in divergent cultural regions for trade. The most common and indivisible barrier which
every company and its work force faces while going or operating globally is difference in culture
as the environment is new for the company and there is a difference in the working conditions
too. (Budhathoki, Schmitt and Michaelidou, 2018). This report comprises of two case studies
that is One of Frank and another of Anna who are thinking to go beyond the boundaries of their
home country for trade and experiences the cross-cultural issues. The report will include some
frameworks of culture which are ordinary in nature and is significant for the companies. The
mentioned frameworks will be useful in enhancing interpersonal communication in both the
cases. The report will be supported by some intercultural interaction theories which can be
applied in the cases.
TASK
Divergent Cultural Frameworks
HOFSTEDE’S CULTURAL DIMENSION

The very common framework for cultural is founded by a great psychologist Dr. Geert
Hofstede. This famous framework is being considered by many businesspersons in their
businesses. Hofstede carried out an extensive and extreme study on more than 100000 employees
who are working at international level by taking their interview to examine the difference in
cultures. The psychologist founded the four dimensions which differentiated the culture and
added two more dimensions to the extension of the study(Emmeche, 2019). The cultural
dimensions model founded by Hofsted are as under:
 Indulgence versus Restraint: the IND (Indulgence versus Restraint) dimension analysis
the area up to which the culture permits the satisfaction. The higher ratio of dimension
gives high level of cultural satisfaction, gratification and pleasure. Whereas the low ratio
conquers the satisfaction and restricts to apply the particular rules and regulations.
 Individualism versus Collectivism: Individualism in this dimension refers to the care
for which the employees are concern about themselves and also for their family.
Collectivism is just contradictory of Individualism which involves the care of the
surrounding people along with of themselves and the family members. Higher
Collectivism culture shows the care of people for all as a whole whereas low culture is
considered for care only related to themselves and family members.
 Power Distance Index: The PDI (Power Distance Index) analysis the range of people
who belongs to a particular culture expect and accept different distribution of power
inside the society's culture. The index also analysis the level of inequalities which the
society manages between them and with their associate members. The index says that
greater the power distance index will leads to greater acceptance of sequential societal
organization and lesser power distance index shows easiness for the culture for equal
distribution of power in society (Emmeche, 2019).
 Masculinity versus Femininity: The next cultural dimension where the cultural
competitiveness is analysed to the Masculinity and Femininity. Masculinity refers to
assertiveness, heroism and material rewards which are concerned for acknowledgement
of success. Feminism refers to care and shyness for others which is providing importance.
 Uncertainty Avoidance Index: The fundamental focus of AVI (Uncertainty avoidance
Index) is how the society's people who are related to particular society stick to the
contingency. Greater proportion of culture of Uncertainty avoidance index is rigid to the

behaviour which can be undetermined whereas lesser index depicts society's common
view point and its principles.
 Long term orientation versus Short term normative orientation: The indication of
traditional and non traditional rules of the society is depicted by LOT(Long term and
short term) dimension. The high LOT reflects non traditional rules or norms associated
with modernization and development whereas less Lot reflects tradition associated with a
particular society's culture.
THE LEWIS MODEL
Another framework for culture is categorised as The Lewis Model. The model was
grounded by Mr. Richard D. Lewis. The objective of the framework is to enhance the
communication between different society and culture along with to state the concept of
simplification of inter-cultural analysis (Farooq, Hao, and Liu, 2019). The model comprises of
three categories which are under:
 Reactive: The first and foremost category in The Lewis Model is reactive. In this culture
politeness is considered as ethics and the society members are called as efficient
listeners. People in this culture looks for principals instead of thinking and investing
their time on finalizing plans with some motive. People under this culture gives
preference to person to person communication instead of interacting secretly. The
members also tries to bring harmony and peace in the interaction instead of giving rise to
any kind of conflicts. Mostly Chinese people are put under this category (Feldman,
2019).
 Multi Actives: The next category comprises of multi actives in the list. The members in
this category are considered as social rather than members of linear active. People are
multi tasking and gives value to work and relationship in this category. They posses the
feeling of care and emotion within society.
 Liner Actives: The members in this category carries out their activity on a specified
time based on their schedules. The people are efficient in their works and supports their
work with reasons and suggestions.

Application of the frameworks to realize distinct interpersonal communication in official
situations
The first case comprises of Frank Mc Dougal, who is planning to establish his
engineering consultancy firm in the regions of Korea. The firm is wishing to shift their six of the
engineers to new operation area that is Korea who belongs to American region. Based on the
situation described in the case Mr. Frank does not agrees upon shifting the engineers rather he
wishes to employee the local people there having accounting skills of excellent level to work in
the company. The accountants will be used for maintaining the company's accounts and to work
upon the operations related to accounting in Korea. (Ma,and et.all., 2017).
To work upon the plan Frank began to recruit the employees with the support of his
rotary club friend. Frank appointed four employees bearing excellent skills but they all wants to
continue their employment with their current existing employer rather joining new American
firm. They all were happy with the position offered by Frank but rejected. Here after the analysis
Hofstede's Uncertainty Avoidance Index is justified and fits to apply.
The model justified here depicts the uncertainty level ans undetermined situations which
can be experienced by the society members of a particular culture. The four aspirants lead by
Frank were bearing low position in the index which shows their refusal of the job offered by
Frank.
Therefore, Frank can refer this model in order to determine the cross cultutal issue which
is required to be defeat for difference in cross culture.
The next case described is of Anna who is a manager belongs to German region. Anna
initiated his operations of sales to Chinese Clients in Chinese market. At an initial level Anna
was feeling pleasant and was fascinated by Chinese people as they behave very soft and humble
with Anna while doing business. Later on with the time she felt that this is an issue in her
working framework as she is coming up with several problems in looking the pros and cons from
all the areas associated with work and the business. The partners rarely uses negative judgements
and always reverts in positive way during the discussing the business concern. (Owusu-Bempah,
2018).
The Lewis Cultural Model can be justified in this Chinese culture specifically the reactive
category is the most suitable in the given context. The reactive culture is mostly found in the
regions of Asia except the Subcontinent of India. The people of china posses the positive aspects

and are mostly soft with other members. They looks for the logical and reasonable principles and
posses the quality of good listeners. They do not like to confront anyone's conversation and
believes on the concept of diplomacy in business conduct. They manages the social and
professional behaviour with a degree of patience with their surroundings at work place.
Anna was not familiar with this culture of China and the situation where she went
wrong . This Chinese culture gives rise to the hurdles for Anna at work place while interacting
with the local clients of China and selling her product to them. In this situation Anna is required
to analyse the diplomacy in cross culture which the Chinese people employees in their behaviour
at work place. Based on the happening situation Anna is required to modify her attitude and
approach during interaction. There is a necessity of understanding the framework of The Lewis
Culture and cooperates with own based upon the requirements of the prevailing culture and
should interact with parties by keeping their culture of diplomacy in mind. (Zhao, 2017)
Application of Intercultural Communication theories to adopt in different business scenario
Intercultural interaction or communication refers to the concept of interaction in different
type of culture and groups at social level. This concept also looks to the communication which
gets affect in intercultural view. This involves the various aspects of communication like issues
which occurs naturally in the organization or in society which went globally for business purpose
from different culture and religion. (Pietersen, 2017).
For various business circumstances different models and theories are considered and are
applied such as in case of Frank and Anna. The first theory is related to cross culture which is
being discussed in the report. Interaction by people belonging to different factors like nationality,
race, age, ethnicity, sexual and gender orientation are considered under this model. The process
of cross culture interaction includes initiatives taken by society people in order to reduce the
differences in cultural aspect through languages, body gestures, etc. through this process people
from different demographics exchanges their thoughts and interacts with each other. This
problem occurred with Anna where she is experiencing hurdles in communicating with the
clients and performing business operations. Anna wants to see the pros and cons of the subject of
discussion whereas the Chinese people presents only the positive views about that. Hence, the
cross cultural theory of communication is a best fit which should be employed in the business
especially in the situations like of Anna in which al the parties brings certain arrangements to
communicate effectively and highlight the agreements (Shim, and et.all., 2018).

The another business circumstance that is of Frank. Frank is experiencing hurdle in
effective communication and making certain negotiation with the best fit candidates in relation to
filling up the position of accounting for his company at Korea. The Korean culture was not
familiar with the Frank and the differences in culture too. The cultural difference results Frank in
not getting the excellent candidates for accounting post in his company as Frank belongs to
America. The candidates were not comfortable in working with Americans rather comfortable
with the existing employment as they belongs to their local region. Here, social support theory of
communication is best fit and can be executed in this situation in which a person can get
assistance from his friend who is local to the region having cultural difference where business is
being taken place. In this current situation Frank can be assisted by his rotary club friend in
getting the knowledge of communication yardsticks and to establish an effective communication
while dealing with the excellent candidates. Frank can also initiate to apply the network of social
support and can grasp the ideas for communication in a supportive way to run the business in
efficient manner in coming future (Xiao, 2018).
CONCLUSION
The present report prospers on the concept of cultural proficiencies and structure where
the culture differs country to country. The concept is required to be analysed deeply by people
who are wishing or planning to go beyond the boundaries of their country for some commercial
purpose with the motive of earning profits. The objective of the present report is to understand
the cross culture difference with various framework which can be fit to the business and can be
used by the business owners in various circumstances. Two models related to the concern are
discussed and analysed in the report which are Hofstead's and Lewis model for culture. For
understanding the requirement of cultural communication the models are applied in the cases.

REFERENCES
Books and Journals
Budhathoki, T., Schmitt, J. and Michaelidou, N., 2018. Does culture impact private label
performance?. International Marketing Review.
Emmeche, C., 2019. Multiculturalism, biosemiotics, and cross-cultural friendship: An essay
review of Olteanu’s multimodal semiotics of culture. Sign Systems Studies. 47(3/4).
pp.590-608.
Farooq, Q., Hao, Y. and Liu, X., 2019. Understanding corporate social responsibility with cross‐
cultural differences: A deeper look at religiosity. Corporate Social Responsibility and
Environmental Management. 26(4). pp.965-971.
Feldman, S., 2019. Cross-cultural leadership and organizational culture: a South african
perspective. International Journal of Social Sciences Management and
Entrepreneurship (IJSSME). 3(2).
Ma, G., and et.all., 2017. Cross-cultural assessment of the effectiveness of eco-feedback in
building energy conservation. Energy and Buildings. 134, pp.329-338.
Owusu-Bempah, K., 2018. Culture, self, and cross-ethnic therapy. In Exploring the Unsaid (pp.
19-33). Routledge.
Pietersen, C., 2017. Organizational culture: a foundational perspective. African Journal of
Economic and Management Studies.
Shim, K., and et.all., 2018. Impact of moral ethics on consumers’ boycott intentions: a cross-
cultural study of crisis perceptions and responses in the United States, South Korea, and
Singapore. Communication Research, p.0093650218793565.
Xiao, T., 2018, July. Promotion of Internet Technology to Cross-border Cultural Communication
Analysis. In 3rd International Conference on Contemporary Education, Social Sciences
and Humanities (ICCESSH 2018). Atlantis Press.
Zhao, D., 2017. The Effects of Culture on International Advertising Appeals: A Cross-Cultural
Content Analysis of US and Japanese Global Brands.