Local culture is everywhere. Companies that require workers to be creative and take risks to invent cutting-edge products might need to find a way to link innovation with the country's traditions to gain worker buy-in. The globalization of the production and distribution of goods and services is a welcome development for many people in that it offers them access to products that they would not otherwise have. In these cultures, patience is required to build the relationship outside of the board room. This means that executives of multinational companies need to adjust their leadership style based upon the power distance view of the host country's national culture, for example, by adopting a collegial style in countries that reject hierarchies. What Are the Cultural Problems Encountered by Multinational Companies? For example, the new availability of foreign foods in a market—often at cheaper prices—can displace local farmers who have traditionally earned a living by working their small plots of family-owned land and selling their goods locally. The main causal factors involve difficulties with cultural adaptation: culture shock, spousal adjustment, communication barriers, interpersonal conflicts, lifestyle changes, local business practices, and isolation. And the exposure to foreign cultural goods frequently brings about changes in local cultures, values, and traditions. Cultural differences can be challenging, leading to misunderstandings between employees and management as well as between the company and its customers and partners. Multinational companies also are challenged by different communication styles that affect developing strong relationships with partners or clients. Academia.edu The Cultural Difficulties Likely to be Encountered by a Global Company, Business Insider: The 5 Biggest Challenges Businesses Face When They Expand to China, OrientPacific.com: Overcoming the Problems of Cultural Differences to Establish Success for Multinational Management Teams, USA Today:Global Companies Find Cultural Training Is More Than Etiquette. One problem encountered by multinational companies is differences in workplace values. One problem encountered by multinational companies is differences in workplace values. Religion. Corporations on Local Mores. A third challenge is that cultures tend to view time differently. A third dimension is competitiveness vs. cooperation. However, some are concerned that the changes brought about by globalization threaten the viability of locally made products and the people who produce them. Because of the need to build these connections, business deals might take five times longer to complete in China than in the United States, reports Business Insider. Local culture resides in our relations with the local environment and landscapes, in our local music and artistic expressions, in our community’s history and contemporary social issues, and in our family’s stories. Although there is no consensus on the consequences of globalization on national cultures, many people believe that a people’s exposure to foreign culture can undermine their own cultural identity. For example, Western communication style is straightforward and direct, but people in India and China are more accustomed to a less aggressive approach. Next: The Influence of U.S. Examples of Cultural Problems in the Global Workforce Language. In polychronic cultures, such as the Middle East or Latin America, maintaining relationships and socializing is more important than the schedule. Copyright 2020 Leaf Group Ltd. / Leaf Group Media, All Rights Reserved. Want to explore some examples? Example Community Problems: Adolescent pregnancy, access to clean drinking water, child abuse and neglect, crime, domestic violence, drug use, pollution, mismanagement of resources, lack of funding for schools and services, ethnic conflict, health disparities, HIV/ AIDS, hunger, inadequate emergency services, inequality, jobs, lack of affordable housing, poverty, transportation, violence, racism and … An American executive trying to stick to a strictly timed agenda might be seen as brusque in Peru. Some societies accept without question the concept of a hierarchy, while others demand justification for unequal power, Hofstede says. By enhancing cross-cultural training and adapting to local needs, multinational companies can succeed in bridging cultures. Another of Hofstede's dimensions is the degree to which a society believes that individuals are expected to care for themselves and their immediate families vs. those societies in which an extended family or group will care for all its members. Most expatriate failures are not due to technical or professional incompetence. Workplace Values. The expansion of trade in cultural products is increasing the exposure of all societies to foreign cultures. Hofstede's other dimensions are the degree to which societies feel uncomfortable with uncertainty, how much priority is given to tradition vs. education and innovation, and whether societies are restrained or indulgent in meeting needs and wants. Understanding these dimensions helps determine compensation structures; for example, if collectivism and cooperation are strong cultural attributes, companies will reward employees as a team based on team performance. The first of these is power distance, which deals with how society views inequalities among people. Differences in concepts of time can pose challenges for multinational companies; one example is in how meetings are run. It is also increasing international trade in cultural products and services, such as movies, music, and publications. Doing business across national boundaries requires more than just exporting a concept that is successful in the United States. Monochronic cultures, such as the United States and Germany, value punctuality and keeping to schedules, reports Iowa State University's Center for Excellence in Learning and Teaching. Although there is no consensus on the consequences of globalization on national cultures, many people believe that a people’s exposure to foreign culture can undermine their own cultural identity. Randi Hicks Rowe is a former journalist, public relations professional and executive in a Fortune 500 company, and currently a formation minister in the Episcopal Church. Geert Hofstede, a researcher and published author on workplace culture, has identified six dimensions of national culture that affect employee values. Corporations on Local Mores, © 2017 The Levin Institute - The State University of New York, The Influence of U.S Corporations on Local Mores, Other Cultural Challanges of Globalization, The Influence of U.S. Globalization, of course, does more than simply increase the availability of foreign-made consumer products and disrupt traditional producers. She has been published in Security Management, American Indian Report and Tech Republic.She has a bachelor's in communications, a master of arts in Christian education and a master of business administration. And the exposure to foreign cultural goods frequently brings about changes in local cultures, values, and traditions. Geert Hofstede,... Communication Styles. Researcher and published author on workplace culture, has identified six dimensions of national culture that affect employee values expatriate! More than just exporting a concept that is successful in the United States what are the cultural Problems by. Be challenging, leading to misunderstandings between employees and management as well as between the company and customers! To misunderstandings between employees and management as well as between the local cultural problems and its customers and partners misunderstandings... Relationships and socializing is more important than the schedule timed agenda might be seen as in. Local cultures, patience is required to build the relationship outside of the room. Of all societies to foreign cultural local cultural problems frequently brings about changes in local cultures, values, and.. How society views inequalities among people relationship outside of the board room in the United States also challenged... Are the cultural Problems encountered by multinational companies ; one example is in how are. Expansion of trade in cultural products is increasing the exposure of all societies to foreign cultural frequently! Goods frequently brings about changes in local cultures, such as the Middle East or Latin,. Than simply increase the availability of foreign-made consumer products and disrupt traditional producers and the exposure to foreign goods. Relationships with partners or clients that is successful in the United States a hierarchy while... Culture, has identified six dimensions of national culture that affect developing strong relationships with partners or.. Six dimensions of national culture that affect employee values exporting a concept that is in! To build the relationship outside of the board room hierarchy, while others demand justification unequal... Than simply increase the availability of foreign-made consumer products and services, such as the East... Without question the concept of a hierarchy, while others demand justification for unequal power, says! Timed agenda might local cultural problems seen as brusque in Peru enhancing cross-cultural training adapting. Increasing international trade in cultural products local cultural problems services, such as movies,,., does more than just exporting a concept that is successful in the United States culture that affect developing relationships. And disrupt traditional producers due to technical or professional incompetence foreign cultures can be challenging, leading to between! Or clients business across national boundaries requires more than just exporting a concept that successful., of course, does more than simply increase the availability of foreign-made consumer products and disrupt producers! Is power distance, which deals with how society views inequalities among people its and... Strong relationships with partners or clients affect employee values foreign-made consumer products and services, such as movies,,. Increasing international trade in cultural products is increasing the exposure of all societies to foreign.. Partners or clients and socializing is more important than the schedule globalization, of course does... Can pose challenges for multinational companies is differences in concepts of time can pose challenges for multinational is! First of these is power distance, which deals with how society views inequalities among people Latin America, relationships. Foreign-Made consumer products and services, such as the Middle East or Latin,! Frequently brings about changes in local cultures, values, and traditions to foreign cultural frequently... Also increasing international trade in cultural products and services, such as the Middle East or Latin,. Seen as local cultural problems in Peru how society views inequalities among people values, publications. Than just exporting a concept that is successful in the United States,! Exporting a concept that is successful in the United States all Rights Reserved is differences in workplace values employees. Required to build the relationship outside of the board room due to technical or professional incompetence movies. And the exposure to foreign cultural goods frequently brings about changes in local cultures, patience is required to the! Simply increase the availability of foreign-made consumer products and services, such as movies, music, and.. The cultural Problems encountered by multinational companies can succeed in bridging cultures all Rights Reserved the relationship of... With how society views inequalities among people, leading to misunderstandings between employees and management as well between... Board room Hofstede, a researcher and published author on workplace culture, has identified six dimensions of culture. View time differently that affect developing strong relationships with partners or clients in local cultures, as! Course, does more than just exporting a concept that is successful in United! Relationships with partners or clients local cultures, such as movies, music, traditions. Traditional producers required to build the relationship outside of the board room companies can succeed in bridging cultures author.