The Impact of Cultural Dimensions on HSBC Operations in India

This report provides an analysis of HSBC's operations in India, focusing on the application of Hofstede's cultural dimensions to understand the challenges and opportunities presented by the Indian market. The report begins with an overview of HSBC's business in India and the rationale for its expansion, highlighting the country's significant population and potential for profit. It then introduces Hofstede's cultural dimension model, explaining its framework for understanding cultural differences across nations. The analysis specifically applies two of Hofstede's dimensions – the Power Distance Index – to the context of HSBC's operations in India. The report identifies and discusses communication and cultural issues that HSBC faced, such as language barriers, technology, and time differences. The report concludes by emphasizing the importance of cultural understanding for successful global business expansion. It references resources like Hofstede Insights and BBC News for additional information and analysis. The report underscores how cultural diversity, conflicts, and language differences affect the business environment.

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Table of Contents
 INTRODUCTION
 Background of the business case on HSBC operations in India
 Hofstede Cultural Dimension Model
 Apply two Hofstede cultural dimension
 Communication & cultural issues experienced by the business due to cultural
differences
 SUMMARY
 REFERENCES

INTRODUCTION
Business is a separate legal entity which offers
goods and services for the betterment of social
people. Every business whether small or large
wish to get a top position at marketplace and
expand globally so that business reach large
number of people and generate more revenue.
Through Hofstede's cultural dimension theory, all
the business can expand their business all over the
world is a better way.

HSBC comes under the largest bank which offers best financial services to the people across
the whole world. Bank expand their business in India so that company can earn high profit
to the Indian people because India comes under the 2nd big populated country so there is
high scope for the business success. In India, company provide many attractive offers and
opportunities which attract the middle class people of Indian society. In term of HSBC bank
operations, India consider as a big plan of project which mainly call for 8000 candidate at
initial level in the international processing centres.
Background of the business case on HSBC operations
in India

Hofstede Cultural Dimension Model
 This theory is developed by Geert Hofsteda, It is the
framework which is used to understand the dimension of
different culture across the world. In other words, It is used
to identify the needs and preferences of the various culture
in different countries. It also analyse the impact of different
culture in business environment that how this will fix the
various aspect of business. This theory is created in 1980
and this covers six categories to define the culture that are
follows-
 Power distance index – In this dimension, those people
include who are less powerful to accept & expect the power
that is distributed in unequal way and they have also belief
about the equal distribution of power in the whole society.

Apply two Hofstede cultural dimension
Hofstede cultural dimension consider as a most appropriate dimension for the cross cultural framework.
HSBC is a big British multinational bank which operating their business across the whole world.
Company operate their business in India and also apply Hofstede cultural dimension so that bank easily
deal with the challenges which create the issue in cultural differences. In this report, two dimensions
considered by the HSBC bank so that company easily tackle the cultural differences issues. The
explanation of these two dimensions which are mainly experienced by HSBC when company operated
their business in India are given below-
 Power distance index
According to this model, India considered as a highest Hofstede cultural dimension context of culture.
This dimension mainly deals with the elements in which individual of society feel they are not equal.

Communication & cultural issues experienced by the business due
to cultural differences
It’s mandatory to focus on communication and cultural factors because these factors are responsible
for the growth of business national and internationally. There are many communication and cultural
issues faced by HSBC of Cultural differences of India the explanation of this differences are given
below-
Language difference – Language consider as a big cultural difference of the company who want to
expand their business in foreign countries for the growth purpose. HSBC chief executive said that to
expand business in India could provide the faster growth in business because India is the biggest
country after China. But bank also faced language differences which became critical in initial level.
Technology and time differences- Technology and time difference also comes under the big issue of
cultural difference for HSBC Company. There is huge time difference between UK and India so
company also experienced many time issues but after some time company recruited Indian employees
who are comfortable to work according the UK timing.

SUMMARY
To summarise this report, it can be said that every company want to expand their business
globally so that company can earn more profit and market value. As per this report it is
concluded that Hofstede's cultural dimension theory play a essential role in context of company
growth and success. When a company want to expand their business then company experienced
many cross cultural differences so with the help of this model company easily cope up all the
cultural differences. This report identified the communicational and cultural issues which affect
the company. This report analysed that cultural diversity, conflicts and language differences
affect the most to the business.

REFERENCES
 Hofstede's Insight [Onlin]Available Through:< https://www.hofstede-insights.com/country/india/
>
 HSBC eyes expansion in India [Online] Available Through:<
http://news.bbc.co.uk/2/hi/business/3144149.stm/>

 HSBC rakes in $1 billion pre-tax profit from India operations in 2019p[Online] Available
Through :<https://www.livemint.com/companies/news/hsbc-rakes-in-1-billion-pre-tax-profit-
from-india-operations-in-2019-11582041619380.html/>

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