Culture Shock in International Business

This assignment discusses the impact of culture shock on multinational companies, focusing on the psychological and emotional effects experienced by expatriate employees when transitioning to a new cultural environment. It analyzes how culture shock can lead to stress, anxiety, disillusionment, and decreased productivity. The assignment also highlights strategies organizations can implement to mitigate culture shock, including cross-cultural training programs for both employees and their families, as well as cultural seminars that provide insights into the host country's educational opportunities, socio-economic conditions, and cultural norms.

Running head: INTERNATIONAL BUSINESS
International Business
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1INTERNATIONAL BUSINESS
In the globalized world of today, as more and more companies are operating beyond the
confines of the local market, the profitability of these companies is also increasing at a high pace.
However, one of the major challenges as encountered by the multinational companies is the
culture shock as experienced by the expatriate employees. As employees of one country are sent
to a different country with different set of values and ideals, the employees most often
experience a sense of psychological disorientation, referred to as ‘culture shock’ (McFarlin &
Sweeney, 2011). Although the entire process of culture shock is regarded as an essential part of
the process of cultural adaptation in a new country, the impact of culture shock can be highly
undesirable for the employees and the company at large.
First of all, cultural shock is a huge problem as it causes stress, anxiety and
disillusionment amongst the employees. As an employee goes to a foreign nation, that has a
completely different cultural outlook on every issue, the employee has hard time in socializing
with the people, making friends with the new co-workers and enjoying motivation at workplace.
Most often, the employee who is not sufficiently trained in cultural background of the other
country will miserably fail to comprehend the how differences in culture can affect the way
business is conducted abroad. Lack of appreciation of a new country, inability to form social
connections as well as incapacity to adjust in a new place will inevitably end in employee
inefficiency (Martin, 2010). The employees in such circumstances tend to become highly
unproductive and inefficient, often more than willing to return to the native country. Thus, the
employee’s inability to complete the foreign assignment for which he was sent abroad, can prove
to be a financial loss to the company, that has spent huge amount of money for sending the
expatriate abroad. It might be important to note here that most often people tend to focus on
employee disorientation, while speaking about culture shock. However, often the employee is

2INTERNATIONAL BUSINESS
sufficiently trained in the cultural outlook of a different country, and yet he may fail to
accomplish foreign assignment because of family concerns. In fact, research reports do suggest
that partner dissatisfaction and family concerns, emerging from issues such as lack of
understanding about the best educational institution in a foreign land, can also leave the
employee de-motivated. The inability of the family members to adjust in a new cultural set-up
can also develop a negative attitude in the employee towards the host culture. This resultant
cross-cultural failure is undesirable for both individuals as well as the organizations.
It is important to understand how to combat the problem of culture shock in case of
expatriate employees. First of all, most of the large and medium size organizations arrange
different cross-cultural training programs for the employees which help in developing cultural
awareness about the host nation. Some of the training sessions intend to glorify the home culture
as well as the host culture so that the employees can better appreciate both the cultures, and do
not end up romanticizing their own only. At the same time, though it is a less acknowledged fact,
companies should also heavily invest in the cross-cultural training sessions for the spouse and
other immediate family members of the employees (Briscoe et al., 2014). This can help the
family members understand the reason behind going abroad as well as the career prospects the
employee will enjoy in future as a result of going abroad. This form of grooming can encourage
appreciation of the family members and help them support the employee abroad (Kovaleski,
2013). Apart from making the employee aware of the cultural background of the new place and
enhancing his linguistic base, it is also important to organize cultural seminars that can help them
understand the educational opportunities abroad, or the socio-economic condition of the foreign
land.

3INTERNATIONAL BUSINESS
As an employee encounters a radically different cultural environment, he tends to
experience a sense of hopelessness and disorientation. It is the responsibility of the organization
he is working for, to prepare him and his family in a way that he can adjust himself in an alien
culture, and can a country as a well-informed person. The effects of prolonged culture shock can
prove to be highly detrimental to the well-being of the employee as well as the financial health of
the company. Hence, proper care should be taken care of.

4INTERNATIONAL BUSINESS
Reference List:
Briscoe, D., Schuler, R. & Tarique, I. (2012). Global HRM: International Human Resource
Management (4th Edition). New York, NY: Routledge [extract is pp 281-285]
Kovaleski, A (2013). Managing Culture Shock for Employees in International Business Settings.
Retrieved from http://www.researchgate.net/publication/236610956 [extract is pp. 3-8]
Martin, J, (2010). Key Concepts in Human Resource Management. Retrieved from
http://www.mylibrary.com?ID=328899 [extract is pp. 120-123]
McFarlin, B. & Sweeney, P. (2011). International Management: Strategic Opportunities and
Cultural Challenges. London, United Kingdom: Routledge [extract is pp. 415-17]