Investigating the Impact of Culture on International Business Success

This literature review investigates the significant impact of culture on international business operations. It begins with an introduction to literature review methodologies and data sources, followed by an in-depth analysis of cultural dimensions, including power distance, individualism versus collectivism, masculinity versus femininity, uncertainty avoidance, long-term orientation, and indulgence versus restraint, based on Hofstede's model. The review explores how these dimensions influence business strategies and organizational structures. Furthermore, the review examines various strategies for managing cross-cultural situations in the workplace, such as embracing diversity, promoting open communication, and fostering strong employee relationships. The conclusion emphasizes the critical role of cultural understanding in achieving international business success, supported by references to relevant academic sources and online resources.

Literature review

Table of Contents
INTRODUCTION...........................................................................................................................1
LITERATURE REVIEW................................................................................................................1
Understanding of different cultural dimensions of regularity and variability and framework to
investigate the impact of culture on international business....................................................1
Different strategies used in international business context for managing cross culture situation
in the workplace.....................................................................................................................3
CONCLUSION................................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
A literature review introduces to the process of collecting and analysing secondary
information about the specific area of study. There are different sources of secondary data
collection and analysis which are books, journals, magazines, articles, publication resource etc.
sources. All these are important and essential sources that will help in gathering and evaluating
of secondary information in systematic manner (Hart, 2018). For this selected choice of the topic
is impact of unequal distribution of power on managerial approach. In order to complete this
assignment, there are some points will be evaluated in critical manner. These are understanding
of different cultural dimensions of regularity and variability and strategies for managing cross
cultural situation of international business in workplace.
LITERATURE REVIEW
Understanding of different cultural dimensions of regularity and variability and framework to
investigate the impact of culture on international business
According to the Gyulavári and Malota (2019), the concept of cultural dimensions is
mainly based on idea, which there are fundamental or important topics each and every culture
has to deal with. Sociologists and Anthropologists sought to describe dimensions of culture to
make various cultures comparable. As per the view presented by James W. Neuliep (2020),
dimensions of culture variability introduce to the dominant values, attitudes, principles, ethics
and beliefs that are shared from the side of identifiable group of person that constitute a culture.
As per the view point of Mihai and Novo-Corti (2020), Hofstede's Cultural Dimensions is
an effective framework of model of culture that was published by Dr Geert Hofstede. This
framework includes six that will be explained as below in detailed manner:
Power Distance Index (high versus low): This dimension of the culture introduces to the
degree inequity or unequal that present and is acknowledged between persons with and without
power (James, 2020). The high power distance index scores show that a society accepts a
hierarchical, unequal distribution of power, and the group of person known their place in the
system. This dimension has impact on international business as it has unequal distribution power
among team members for example: H&M has a business in UK and China where different
conditions exists on culture basis that having further impact on their organizational operations
and strategies. UK has culture of equal power distribution that allows organisations to bring
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coordination between the working of male and female. Whereas, in China power is not equally
distributed so to be effective at workplace they have to adjust according to the cultural situation.
Along with this, company adjust their business according to the culture of the countries
(Setiawan, Singh and Romijn, 2019).
Individualism Versus Collectivism: This introduces to the strengths of the ties that group
of person or an individual have to others in their community. Main purpose of this culture
dimension is working in group or individually. For example: In China, people like to work
collaborative and in group, whereas, in UK persons link to work individually. Therefore, it is
important for international business to follow all culture of the country because it will help them
in making higher profitability. High individualism versus collectivism value placed on person's
time and their requirement for freedom and privacy. If H&M expand their business in China, it is
beneficial for them because the culture of china is collaborative that turn to impact on their
performance and productivity in positive manner.
Masculinity Versus Femininity: This dimension refers to the role's distribution between
women and men. In masculine socialites, roles of men are higher as compare to female. For
example: Japan has the highest Masculinity Versus Femininity, whereas the Sweden has the
lowest Masculinity Versus Femininity (Thanetsunthorn and Wuthisatian, 2018). Therefore, if
H&M open their business in Japan, they should recognise them are operating in a deferential,
hierarchical and traditionally patriarchal society. Therefore, it is important for company to follow
culture of each country where they want to expand their business operations and functions. This
positively impact on business growth and success in positive manner.
Uncertainty Avoidance Index (high versus low): This dimension explains how well
person can cope with anxiety. For example: Greece top the Uncertainty Avoidance Index,
whereas Singapore lower the Uncertainty Avoidance Index. Therefore, in Greece, H&M might
be keen to create discussion, because they identify that are a cultural tendency within team
members to create the most conservative decision, make the safest and despite any emotional
outbursts. Thus, it is essential for company to adjust in all culture and improve their brand image
effectively (Linjing and Jingfeng, 2020)
Long- Versus Short-Term Orientation: This introduce to the time horizon person within
a society display. For example: United stated has a short term orientation that reflects in the
significance of quick results and short-term gains. It is also reflecting within the nation's strong
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sense of social standards and nationalism. UK is the long term orientation that impact on
business performance of an organisations. For example: H&M should focus on the culture of all
countries where they want to enlarge their business operations successfully. This will support
business organisation in improvement of business growth and success effectively.
Indulgence Versus Restraint: This is a last dimension of culture model that impact on
business performance. Nations with a high Indulgence Versus Restraint score encourage or allow
comparatively free gratification of person's own emotions and drives, including enjoying life and
having fun (Murphy, Gölgeci and Johnston, 2019). For example: Eastern European countries
have a low Indulgence Versus Restraint. There is tendency towards pessimism. This will impact
on company while developing their business in particular nations.
Different strategies used in international business context for managing cross culture situation in
the workplace
According to the CAROL M. KOPP (2019), Cross culture within the business world
introduces to an organisation's efforts to make sure that its employees interact in effective
manner with professionals from background which is different from their own. Along with this,
geopolitical changes or variation have opened up a markets where organisations compete in
order to stake their hold. To know the customers and increase their returns and investments,
organisations require to develop a strong and efficient infrastructure with effective managerial
management, which can assist to create valuable assets. Most organisations have to interact in
territorial extremity and these extremities are nor along relate on economic relations. There can
be various culture identifiers that ranging from religious practices, dress code, nonverbal
behaviour, festivities etc. also, gender issues and generation gap can develop differences within
the relation of employees and employers and between workers themselves. According to the
Dholakiya (2017), there are different strategies that are essential and effective for an organisation
in managing of cross culture situation at international workplace. These strategies are:
Embrace diversity: A diverse workforce within a workplace shows challenges in forms of
customs, communication and region (Luthans and Doh, 2018). In these situation or condition, it
is essential for organisation to not just accept any type of differences, but entirely embrace them
in entire their business. This will help international organisation in improvement of its business
operations. It is extremely humbling experience for companies while opening their operations by
differing the lifestyles and culture. Therefore, it is important for company to promote diversity in
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the workplace that results are higher innovation, better decision making, reduced employee
turnover, increased creativity etc.
Promote open communication: This is another effective strategy that helps business
organisation in overcoming the issue of cross culture in the workplace. When managing workers
from various parts of the globe, successful organisations realise that effective communication is
everything. This will help an organisation in reducing of conflict or misunderstanding among
employees that results are increased employee’s retention, improved business performance and
higher growth (Peterson, Arregle and Martin, 2020).
Foster strong relationship among employees: This is also considered important and
essential strategy of managing cross-culture situation effectively. Team-building is considered as
a overlook part of the organisation world. This is important for an organisation to foster strong
relationship in among their employees as it will support them in attainment of competitive
advantages within a minimum time period and in successful manner (Teagarden, Von Glinow
and Mellahi, 2018). This will also support an enterprise in enhancing of its brand image and
reducing the cross-culture situation in effectively that output is increased sales, higher
employee’s relation and increased customer satisfaction.
CONCLUSION
From the above mentioned information, it has been concluded that culture is important
part of the business success and growth. Hofstede's Cultural Dimensions model was used for
understanding the information about the country. This supported international business
organisation in developing of its business successfully.
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REFERENCES
Books and journals
CAROL M. KOPP., 2019. Cross Culture. [Online]. Available through:
<https://www.investopedia.com/terms/c/cross-culture.asp>.
Dholakiya, P., 2017. 3 Tips for Managing a Cross-Cultural Workforce. [Online]. Available
through: <https://www.entrepreneur.com/article/288796>.
Gyulavári, T. and Malota, E., 2019. The role of culture personality and self-congruity in the
evaluation of cultures as destinations. Tourism Review.
Hart, C., 2018. Doing a literature review: Releasing the research imagination. Sage.
James., 2020. Dimensions of cultural variability. [Online]. Available through:
<https://www.britannica.com/science/dimensions-of-cultural-variability>.
Linjing, D. and Jingfeng, Z., 2020. Cultural risk and management strategy for Chinese
enterprises' overseas investment. China Economic Review, p.101433.
Luthans, F. and Doh, J.P., 2018. International management: Culture, strategy, and behavior.
McGraw-Hill Education.
Mihai, I. and Novo-Corti, I., 2020. Cultural distance and migration patterns in the EU: The
Romanian case.
Murphy, W.H., Gölgeci, I. and Johnston, D.A., 2019. Power-based behaviors between supply
chain partners of diverse national and organizational cultures: The crucial role of
boundary spanners’ cultural intelligence. Journal of Business & Industrial Marketing.
Peterson, M.F., Arregle, J.L. and Martin, X., 2020. Multilevel models in international business
research. In Research Methods in International Business (pp. 417-432). Palgrave
Macmillan, Cham.
Setiawan, A.D., Singh, R. and Romijn, H.A., 2019. Responsible innovation: moving towards a
culturally sensitive approach. Studies in Asian Social Science, 6(2), pp.46-65.
Teagarden, M.B., Von Glinow, M.A. and Mellahi, K., 2018. Contextualizing international
business research: Enhancing rigor and relevance. Journal of World Business, 53(3),
pp.303-306.
Thanetsunthorn, N. and Wuthisatian, R., 2018. Cultural configuration models: corporate social
responsibility and national culture. Management Research Review.
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