Question

Outline why the culture of a Country might influence the cost of doing Business in that Country. Illustrate your answer with examples.

Answer 1

Spreading business in international market is common these days. We face challenges of cultural diversity among countries when we break technological hurdles and accelerate towards making business globally. Today, business atmosphere is more competitive and a bit of cultural diversity is also included in our business environment. The challenges of cultural diversity affects the cost of running business internationally. China, doing business with most of the countries need to learn the way each country does business. Sometimes it invests to know the correct way to approach people and to know their tastes and preferences. Let's discuss some examples of how culture influences the cost of doing business. When people of different countries interact with each other within different norms, the costs of doing business rise as many people are engaged with unfamiliar ways of doing business. For example, in the US people prefer to do business first then have a social discussion in order to develop a social relationship, whereas many South American countries give importance to develop a good social relationship before having a business discussion. A country's religion can also impact the costs of business, as religious values can affect work attitudes, honesty and social responsibility. In Hindu families there are different religious beliefs which affect the productivity of worker. Similarly, a country's education system also have some impacts on the cost of business. In countries, where workers are highly literate and have excellent training, they don't need specific worker training programs and companies can go on hiring more number of workers with a little bit of awareness among workers.