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Importance of Cultural Understanding in Business

Cultural understanding is crucial for managing global business operations and effectively reaching diverse customers, as it enhances communication, productivity, and market insight. Employees with cultural knowledge can tailor products and services to meet the expectations of various demographics, avoiding negative sentiments. Additionally, the document discusses the importance of diversity in the workplace and the need for businesses in Singapore to avoid ethnocentricity to appeal to a broader consumer base.

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0% found this document useful (0 votes)
4 views4 pages

Importance of Cultural Understanding in Business

Cultural understanding is crucial for managing global business operations and effectively reaching diverse customers, as it enhances communication, productivity, and market insight. Employees with cultural knowledge can tailor products and services to meet the expectations of various demographics, avoiding negative sentiments. Additionally, the document discusses the importance of diversity in the workplace and the need for businesses in Singapore to avoid ethnocentricity to appeal to a broader consumer base.

Uploaded by

inisgan05
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

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Tutorial 4: Cross Cultural Perspective

Question 1:

Why is cultural understanding important in managing the business globally? (Hint: your
answer should include 2 aspects: managing international business operation & reaching
out to customers)

First, being able to understand culture better enables a person to effectively and happily
work within the organization. In a global environment, employees come from various
background with their personal values and beliefs. With knowledge on the different
cultures, it will enhance one’s ability to communicate and understand each other’s
opinions and ideas clearer.
The employees can also be better managed as their beliefs and values are
acknowledged by each other. Ultimately, these boost productivity and unity in the
workplace.

Second, cultural knowledge allows to understand the consumers’ market better. The
scale of a global operation inevitably reaches out to consumers from different countries,
with their own set of shared norms, beliefs and values. Since different markets have
different standards and expectations, it will be vital that the employees have knowledge
on that specific culture. Only then, they will be capable of customizing and altering
specific parts of that goods and services to target and satisfy specific demographics,
without evoking any negative sentiments or causing offenses to that market.

Question 2:

A: Interview your friends / family

Find one of your family or someone whom you are very close to. The person should be
(or was) working full-time for more than 3 years.

Before you ask following questions, please make sure to inform the person interviewing
that you will be sharing the information with your classmates and tutors. During the
class, please do not share information that violates your family members’ privacy, or
company’s confidential information.

1. Where is the company’s HQ?


Delft, Netherlands.

2. Please describe the national or racial diversity of your company. (e.g. 10%
Causasian, 60% Chinese, 20% Malay, 10% Indian)

There is about 70% Chinese, 20% Malay and 10% Malay.

3. How would you describe the relationship with your boss? Is your manager / boss
more like a friend, or more like a voice from higher place?

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Tutorial 4: Cross Cultural Perspective

More like friend More like voice from heaven

4. When your manager / boss makes any business decision, is it based more on
his/her own thinking, or on collective agreement from employees?

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Boss’ own thinking Collective agreement

5. When your company or boss sets a goal, is it more for short-term (less than 1
year) or long-term (more than 1 year)? If they set both, which one do you think
your boss consider it to be more important?

The goals that my company sets are for long term. For instance, the top-level
managers will fixate a KPI for the employees to hit for the month. These short-
term goals will translate into long term benefits as the company has more
revenue for expansion and business opportunities. In the end, the managers are
focusing on the future prospects for the company

6. What is the male / female ratio of the company? Do you think the company
provide equal opportunity for women to be in managerial position?

There is about 1:5 in terms of female to male ratio. It is quite obvious that the
company does not provide equal opportunity as most of the bosses and
managers are male. The female employees are usually doing paperwork or jobs
that do not require much exertion.

B: Sharing the findings during tutorial session

Please form a small group, and share your findings from interview and have a
discussion on these 3 topics with your classmates.

 Is there any difference between non-SG companies and local company?

Yes, I think there are several differences due to their different culture.
First are the different views on work-life balance. For instance, between a
Singapore and China company, the China company will prioritize their success
and work-life before leisure and family time. This stems from their culture being
very success-oriented and driven. An example is the “996” culture which China
companies employ; working 9am to 6pm for 6 days weekly. In contrast, a
Singapore company will prefer to maintain a healthy work-life balance.

Another is the degree of power and authority a person can hold over the other. In
a Singapore company, bosses and managers have high control over employees,
as employees are expected to do as they are told. This is only natural as
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Tutorial 4: Cross Cultural Perspective

Singapore has a PD score of 74 whilst in the United States, they have a low PD
of 40. From this figure, we can expect the power centralization to be very
different in its respective workplace.

 Does the national / racial / gender diversity within the company make any
difference?

Yes, there are 2 reasons for my belief.

First, such diversity can contribute to innovative ideas. People of different culture
will have differing experiences and perspectives towards certain things. Such
differences can be leveraged as people with different perspective come together
to spark a new idea.

Second, such diversity will be advantageous towards the company. With


employees from various backgrounds, they can understand the consumers and
market better than those of local culture. This is a crucial aspect as the company
will get to target and satisfy the market better than its competitors whom focus
less on diversity in workplace. Ultimately, such diversity can create a competitive
advantage for the company.

 Why do you think avoiding ethnocentricity is important for businesses in


Singapore, regardless of the size and nature of business?

The local market is extremely diversified with foreigners and locals of various
ethnicity. It will be pivotal for the business success, to avoid ethnocentricity so
that they can target a larger consumer base and have a reputable business in
Singapore. Besides, the government emphasizes greatly on an inclusive society,
evident through measures like the Ethic Integration Policy. Therefore, to remain
reputable and welcome in Singapore market, businesses cannot show
condescending nor superior behaviors to certain culture. Instead, they should
show inclusivity and open-mindedness to appeal to all demographics across
Singapore market.

In the end, the company can benefit in terms of higher profits and support from
the local community.

After sharing the findings within the smaller groups, summarize your findings and
present to the rest of the class.

Masculine; Men should bring money home and women stay home

Feminine; Women can take up gender roles job too. Eg more female representatives in
Sweden

Indulgence; will not control their desires

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Tutorial 4: Cross Cultural Perspective

Eg; American v Japanese family after not seeing child for 2 years.

American; express emotions loudly, not controlling them

Japanese ; control emotions and just say hi and ask how was their exams

McDonald operate globally but act locally.

Low v High Context Culture

Establishing relationships is an important part of communicating and


interacting. Unlike the linear communication style preferred in low-context
cultures, high-context communicators may use spiral logic, circling around a
topic indirectly and looking at it from many tangential or divergent viewpoints.
A conclusion may be implied but not argued directly.

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