International Business: Thai and Australian Cultural Differences

This essay examines the critical role of business culture and etiquette in international collaborations, focusing on the differences between Thailand and Australia. It highlights the importance of understanding cultural dimensions, as defined by Hofstede, to avoid miscommunication and foster successful business relationships. The essay uses a case study of an Australian startup, Aye Oz, expanding into Thailand, and analyzes the business practices, communication styles, and hierarchical structures prevalent in both countries. It emphasizes the need for Ms. Cooper, the CEO, to adapt to Thai business etiquette, including formal invitations, punctuality, gift-giving, and the importance of the 'wai' greeting. The essay also explores potential areas of conflict arising from differences in cultural dimensions such as power distance, individualism, and uncertainty avoidance. By comparing the two nations, the essay provides actionable insights for navigating cross-cultural business scenarios and achieving successful international ventures. The paper concludes by emphasizing the need for cultural sensitivity to ensure effective communication and build strong business relationships.

Running head: BUSINESS CULTURE
Academic Communication Business and Economics
Name of the Student:
Name of the University:
Author note:

1BUSINESS CULTURE
Introduction
First impressions are very important in a successful business, especially in case of
international business collaborations. Business etiquettes play a significant role in introductions
in a business environment and in determining the course of establishing terms and conditions of
a business in a business meeting (Padhi 2016). The business culture and work etiquettes are
generated from the culture and traditions of a country. Hence, for any international business
venture, it is necessary to have knowledge about the cultural differences and characteristics of
the other country so that norms can be followed in the business meetings which would also be
beneficial to show respect for the people belonging to another country and culture (Tanaka and
Kleiner 2015). Aye Oz, the Australian start up Food Company will be expanding its business in
Thailand and hence, they require to go for a partnership with a Thai food company to enter the
new market and capture a substantial market share. Thus, while making business collaboration
with Eatum Food Company of Thailand for expanding the business, it is highly essential for the
Aye Oz CEO, Ms. Cooper to understand the business etiquettes of Thailand and behave
accordingly while meeting the manager of Eatum Food Company, Mr. Thi Le. In this essay, an
overview of the business culture and etiquettes in Thailand, possible ways to increase the
potential business success and scopes of potential miscommunication due to cross cultural
differences on the basis of the Hofstede cultural dimensions will be provided in an in-depth
manner.
Discussion
Thailand is one such country in Southeast Asia that was never colonized. Hence, the
social and business cultures of Thailand have never been greatly influenced by the western

2BUSINESS CULTURE
culture. However, some traits of the Thai business culture have originated or influenced by the
cultures of the neighboring countries, such as, collectivism, strong hierarchy, courtesy etc. The
Thai business culture is greatly shaped by ‘sanuk’, a concept that explains the effort for
achieving satisfaction in any type of work one does (Warner 2014). This is a guiding principle in
any work and business setting, which implies that the Thai people make their work a pleasant
and enjoyable experience.
The fundamental aspects of the Thai business culture include the following things which
should be followed in any business meeting for making a favorable first impression in Thailand.
The formal business meetings are preceded by a written invitation and a follow up phone call.
Punctuality and formal attire are expected in the meeting. Any formal business conversation is
preceded by small talks on personal topics such as family, hobbies, education, etc. to make the
environment comfortable and create relationships (Culturalatlas.sbs.com.au 2019). The exchange
of business cards and documents are done using right or both hands and having a look at the card
before storing it away has significance in Thailand. Furthermore, organizational hierarchies are
strictly maintained in any business meeting. Period of silence in meetings is also important in
Thailand as it is a norm to make thoughtful considerations before giving any response. In terms
of business communication, face and expressions are very important in Thailand. One should
remain careful about the emotions displayed. Listening is also very important as that reflects
respect for the speaker (Santandertrade.com 2019).
Thus, while meeting Mr. Thi Le, Ms. Cooper should focus on the above mentioned
cultural and behavioral aspects. She should send a formal invitation and do a follow up phone
call prior to the meeting with Mr. Le. She should also maintain punctuality by checking the
traffic status in the city. Furthermore, as the Thais are not much proficient in English, Ms.

3BUSINESS CULTURE
Cooper must check if an interpreter is necessary. The attire should be formal as per Thai business
traditions. Moreover, Ms. Cooper should have her business card for exchange during the meeting
and it should be of high quality. Furthermore, Ms. Copper must consider the organizational
hierarchy while meeting with Mr. Le. These gestures will make a good impression of Ms.
Cooper while meeting with Mr. Le.
Ms. Cooper should also focus on some more aspects to make the meeting and future
business agreements successful. In the Thai business culture, small token gifts are often
appreciated and hence the practice of giving token gifts improves the first impression (Cooper
2019). During the meeting, the Thais offer ‘wai’ as it is the most common form of greeting. It is
a gesture of hands, in which the palms are placed together and raised to the eyelevel while the
head is inclined slightly. However, it is extremely important to return the wai offered by the
Thais. Furthermore, a subordinate or a junior person must offer the wai first as organizational
hierarchy and seniority are given much importance in Thailand (Powell, Amsbary and Hickson
2014). The Thais give much importance to educational degrees and hence, while making small
talks prior to the formal business conversations, the discussion on education creates a good
impression about the speaker. Moreover, similar to the importance on organizational hierarchy,
the addressing also plays a significant role in the success of any formal business meeting. In the
formal meetings, the surnames are used for addressing verbally as well as in written
conversations. First names and titles are used in informal and personal communication
(Santandertrade.com 2019).
Thus, it can be suggested that as Ms. Cooper is meeting the manager of Eatum Food
Company, Mr. Le, who is an elderly person, she should focus on minute aspects of the Thai
culture, such as, addressing Mr. Le by his last name, offering wai first while meeting Mr. Le,

4BUSINESS CULTURE
bringing small token gifts from Australia, such as, books, or something belonging to the
Australian culture, and initiating small talks prior to the formal business conversations,
especially about education. These gestures will be helpful for Ms. Cooper for not only to make a
good first impression, but also to increase the chances of success of the meeting and the future
business agreements.
However, even though Ms. Cooper follows the business etiquettes of Thailand while
meeting Mr. Le, there can still be chances for miscommunication. This can happen due to some
basic differences in the cultural dimensions between Thailand and Australia. According to the
comparison of the two nations as per the Hofstede cultural dimensions, it is seen that Thailand
scores higher than Australia in power distance, uncertainty avoidance, and long term orientation.
On the other hand, Australia scores higher in the dimensions of individualism versus
collectivism, masculinity versus femininity and indulgence versus restraint (Hofstede-
insights.com 2019). Thus, it can be said that the high score in the power distance index for
Thailand explains the rigidity in the organizational hierarchy and importance in seniority.
However, Ms. Cooper might not be able to understand as in the Australian culture the
organizational hierarchy is much flexible. While Ms. Cooper is the CEO of Aye Oz Food
Company in Australia, she might not be able to understand the address system in Thailand as the
system is quite different Australia than in Thailand and she might follow the addressing with first
names unlike in Thailand. Hierarchical rigidity and addressing system is highly important in
Thailand for a successful business meeting, and if it is not followed, the Thai people might take
offence (Chekhovskaya 2015). Moreover, Ms. Cooper will have an individualistic approach
towards work and work culture, while Mr. Le will prefer to have a collectivist approach towards
work. Ms. Cooper might also display gestures reflecting the indulgence and aggressive nature of

5BUSINESS CULTURE
the Australians towards work, while Mr. Le would prefer to have more compassionate approach
and long term orientation about the business projects. Furthermore, the risk taking nature and
gestures will be reflected more for Ms. Cooper than for Mr. Le as the uncertainty avoidance is
quite low for the Australians than the Thais as per the Hofstede cultural dimensions. In these
aspects, there can be scopes for potential miscommunication.
Conclusion
It can be concluded from the above discussion that business and work culture and
etiquettes play a very crucial role in deciding the course of international business collaboration.
The etiquettes and attitudes of people originate from the cultural dimensions of a nation which is
aptly described by Hofstede through the 6 cultural dimensions. From the comparison of the
cultural aspects of Australia and Thailand, it is found that there are some distinct differences in
some basic cultural aspects between the two countries. While the Australians focus on
individualistic approach and efforts in the workplace and provide flexible hierarchical structure
and norms, the situation is different in Thailand. The Thai people prefer to work under a strict
organizational hierarchical structure. Thus, for creating a successful business deal Ms. Cooper
must focus on understanding the nuances of the Thai culture and adopt the common practices to
create a good first impression in front of Mr. Le and have a successful business deal for
expanding the business of Aye Oz in Thailand in collaboration with Eatum Food Company.

6BUSINESS CULTURE
References
Chekhovskaya, S.A., 2015. POWER DISTANCE IN INTERCULTURAL BUSINESS
SETTINGS: NONVERBAL ASPECT. Бизнес-образование в экономике знаний, (1), pp.146-
148.
Cooper, R., 2019. CultureShock! Thailand: A survival guide to customs and etiquette. Marshall
Cavendish International Asia Pte Ltd.
Culturalatlas.sbs.com.au, 2019. Thai Culture - Business Culture. [online] Cultural Atlas.
Available at: https://culturalatlas.sbs.com.au/thai-culture/business-culture-952560c8-2f2f-4fe2-
93cf-f9e398ca5735#business-culture-952560c8-2f2f-4fe2-93cf-f9e398ca5735 [Accessed 24 Jul.
2019].
Hofstede-insights.com, 2019. Country Comparison. [online] Hofstede Insights. Available at:
https://www.hofstede-insights.com/country-comparison/australia,thailand/ [Accessed 24 Jul.
2019].
Padhi, P.K., 2016. The rising importance of cross cultural communication in global business
scenario. Journal of Research in Humanities and Social Science, 4(1), pp.20-26.
Powell, L., Amsbary, J. and Hickson, M., 2014. The Wai in Thai culture: Greeting, status-
marking and national identity functions. Journal of Intercultural Communication, 34(1), pp.7-7.
Santandertrade.com, 2019. Business practices in Thailand. [online]
En.portal.santandertrade.com. Available at: https://en.portal.santandertrade.com/establish-
overseas/thailand/business-practices?

7BUSINESS CULTURE
&actualiser_id_banque=oui&id_banque=0&memoriser_choix=memoriser [Accessed 24 Jul.
2019].
Tanaka, A. and Kleiner, B., 2015. Cross-Cultural Business Etiquette. Culture & Religion Review
Journal, 2015(1).
Warner, M., 2014. Culture and management in Asia. Routledge.

8BUSINESS CULTURE
Appendix
Figure 1: Country comparison - Australia and Thailand
(Source: Hofstede-insights.com 2019)