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Why cultural awareness is good for business

Making the effort can make all the difference

If you want to work effectively with customers and suppliers from around the world, and avoid potential misunderstandings, it pays to understand cultural differences.

As your business grows and expands into new markets, you’ll be dealing with an increasingly diverse range of countries, customs and people. Making an effort to adapt to different processes and ways of communicating will go a long way towards creating successful business relationships.

Bear in mind that what may be the norm in one business abroad doesn’t mean that others in that country follow the same path, and what may be the common unspoken rule today could be forgotten tomorrow. Technological developments, generational divides and political conflicts all affect the societal and global landscape, so you might experience a lot of variety over time.

Understanding culture

While it’s useful to have a working knowledge of a foreign language, or even be fluent in one, good communication involves much more than that. In fact, research shows spoken language makes up only 30% of human communication1.

You’ll need to be aware of things like body language, etiquette, forms of address and attitudes to personal space, as well as have an idea about general attitudes towards money, business relationships and timekeeping in the countries you’re dealing with.

Try to avoid thinking in terms of clichéd national stereotypes as these can be misleading or outdated – it’s more important to understand how wider cultural influences can affect ways of working.

Organisational differences

Cultural differences can have a major influence on how businesses are organised. Some countries adopt a more hierarchical rather than egalitarian approach, or emphasise a more collective than individual mindset in business.

In some parts of Asia, for example, businesses tend to be more hierarchical and authority is highly respected. Status and respect are seen as very important and attempts to circumvent hierarchy may not be appreciated.

Another area of potential cultural sensitivity is whether feedback is given directly or indirectly. North Americans, and many Western European cultures, generally adopt a direct approach, whereas in other parts of the world, constructive criticism in person may be considered disrespectful.

Building trust

Trust is at the heart of successful international business relationships, but can be built in different ways in different cultures.

Relationship-based trust is developed through knowing and bonding with people over time. People in cultures where this is more usual are likely to express more personal familiarity with each other and want to work only with trusted vendors, suppliers or advisers. You can earn task-based trust by showing that you are dependable and knowledgeable, and are interested in delivering a solution without a hidden agenda. It pays to know which approach to adopt.

Some cultures focus on achieving the best financial outcome in any business interaction, regardless of any existing relationship. Others emphasise building long-term relationships where ‘small talk’ can play an important role, and there may be more concern about damaging relationships by focusing on price alone.

The importance of context

Communication can take two broadly different forms, depending on culture. Understanding whether your business contacts are ‘high context’ or ‘low context’ can help you adapt your communication style and build stronger relationships.

In ‘high context’ cultures, a lot of unspoken information can be part and parcel of business communication, with an emphasis on relationships and loyalty, and less attention paid to rules and structure.

In ‘low context’ cultures, information is more often exchanged explicitly and business relationships may be more short-term and task-based, with more rules and standards.

Creating a good impression

A smooth first introduction always helps to get things off on the right foot, but do you shake hands, kiss on each cheek or bow?

The answer is to learn the local custom before meeting people, as many cultures have their own style of greeting. So when you meet someone for the first time, listen carefully to how they’re introduced and use that form of address.

In some parts of the world, it’s considered polite to give a small gift when meeting someone – just be sure not to cause embarrassment by giving one that’s very expensive and puts the recipient under pressure to give something back.

The meaning of certain social cues can differ, too. In some cultures, a handshake is the equivalent of a legal contract and in some parts of the world a period of silence may signal displeasure with what you’ve said rather than being a pause for thought.

All about timing

In some regions sticking rigidly to a meeting time is not a deal-breaker and it’s considered acceptable to be late, so be prepared and go with the flow.

We can connect with overseas contacts instantly online, but it’s important to take time zone differences into account when arranging audio or video meetings, as well as cultural differences. Long lunch breaks are the norm in some countries and people may be unavailable for certain parts of the day, so it’s best to check availability before arranging any calls.

Personal space

It’s worth noting that, globally, there are many different notions of acceptable personal space and physical contact. In some cases, even a handshake could be frowned upon, so it’s important to research this before visiting a country and observe people’s behaviour once you’re there.

Dress for success

Dress codes are obviously important because they affect the way people see you. Don’t assume that, because you work in an industry where casual dress is standard, this will be the norm in the country you’re visiting – it’s probably better to err on the side of caution at the beginning and wear something smart.

Politics and government influence

Some cultures have a strong sense of nationalism and pride in government, and are happier dealing with firms with some sort of governmental backing.

You may need to tread carefully when doing business with, or working in, a country that’s in any sort of dispute with the UK. It’s best to avoid discussing politics unless it’s directly relevant to what you’re doing.

Don’t forget your customers

Your personal interactions, marketing and sales campaigns will also need to take cultural differences into account.

Make sure you research the cultural norms of your target audience and reflect them in your marketing – if your customers feel that you understand them, this will help to increase engagement and sales of your product or service.


1 Statistic from Prof Denis LeClerc, Thunderbird School of Global Management, Arizona, USA.

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