“Culture is the collective programming of the mind which distinguishes the members of one group or category of people from another “(Hofstede, 1994). As regards International business, culture influences many aspects through differences in dealing with behaviour, negotiations, communication and transactions of any given country. It is vital for a manager of a company to understand and respect the role culture plays in a country when it is growing in order to achieve global success.
Lee et al. (2011) studied the impact of culture in international organisations in the context of expanding their businesses into newer regions with different prevailing cultures and the results found that in order to succeed in a global business expansion it is hugely important for any such organisation that the cultural differences are understood so businesses can bridge the gap between different units performing in multiple cultures.
In order for the business to grow globally the managers must first develop and enhance their own cultural awareness and sensitivity. By developing an advanced level of cultural awareness, managers will find that participating in business agreements and negotiations in different countries and cultures will prove more successful in the future. With regard to enhancing their cultural sensitivity the main key factors to consider include language and communication, etiquette, negotiation, time perception and observation. Through developing and understanding these factors, the managers will benefit greatly when dealing with multicultural business units.
Language and communication is perhaps the biggest challenge facing managers in the international business environment. Excellent communication skills both, verbal and non- verbal are vital when dealing across cultures as if they are not adhered to correctly and appropriately as regards the culture of the particular country in question then it can result in a business agreement falling apart. Being familiar with the etiquette of a country can also make a huge difference regarding success. Small details such as greeting, language used and handshakes are fundamental. For example, in Ireland or the United states, when a manager introduces them self to another business partner, shaking each other’s hands would be the appropriate thing to do. However, in other cultures a greeting that involves a hug, bow or kissing each other on the cheek may be more the norm. Becoming aware of another culture’s etiquette is crucial in international business as making a mistake with even a tiny gesture can offend a potential business partner.
Another important factor to be familiar with that can enhance one’s cultural sensitivity in international business is concerning negotiations and how different cultures perceive time. When businesses are negotiating with each other in trying to reach an agreement it is important to know how to approach the situation in an appropriate manner. For example, in Ireland it is a matter of yes or no when negotiating or coming to an agreement. However, in many other countries and cultures around the world this is not the case and negotiations can be slightly more complex. For example, in Japanese culture it is rude to say “no”, therefore, business professionals must have the ability to guide the conversation towards different options and be aware of what is acceptable. As well as that, is also important to become familiar with various cultures perceptions of time and what constitutes as rudeness or tardiness when arriving at a business meeting. Whilst an Irish or an American business manager may arrive to a meeting a few minutes early an Italian manager may arrive several minutes late and still consider themselves “on time”. Simply being aware of these small factors can determine the success of a business internationally.
Therefore, it is clear that culture plays a huge role in International business today and even subtle cultural differences can have a major impact on the success of a globally growing business. Through managers becoming aware and making themselves familiar with these differences they will benefit and succeed.
Sources of Aid Available to Irish Businesses in International Growth
The Irish Government gives loans, grants, tax incentives, financing and non-financial assistance to help companies grow locally and internationally. Companies can apply for funding to over eighty different sources of government finance & support.
Kite should start with their Local Enterprise Office (LEO) in Prospect Hill. They help companies that have ten or less employees. They provide mentorship, training, direct financial supports, advice on alternative funding options, business information, advisory services and enterprise support and can create progression pathways for high-potential companies to Enterprise Ireland, feasibility grants for market research for a product, microfinance loans from €2,000 to €25,000 from 3 to 5 years with reduced interest rate of 6.8% for LEO clients and flexible repayment terms, the business expansion grant to help after the eighteen month start-up period if, have at least ten employees, manufacturing or internationally traded services business and have the potential to trade internationally. The maximum form this grant is 50% of the investment or €150,000, whichever is the lesser. Grants over €80,000 and up to €150,000 are only the exception and can only apply for projects that clearly demonstrate a potential to graduate to Enterprise Ireland and/or to export internationally. Subject to the 50% limit, a maximum grant of up to €15,000 per full time job created shall apply in respect of any employment support grant aid, trading online vouchers to help businesses trade online up to a max of €2,500 if, have at least ten employees, turnover is less than €2m and have to been trading for at least twelve months but they must apply and be approved before carrying out any work they intend to apply for grant support.
Enterprise Ireland works with Irish companies and help them to, grow, innovate and win export sales on global markets to sustain economic growth, regional development and secure employment. Kites local Enterprise Ireland office is in Mervue. They may be able to provide funding that are tailored to suit their stage of development and their specific funding needs, exporting assistance to countries such as Canada, helping to become leaner, access to a global network of contacts from heads of government to end customers and introductions to experts such as technology and investment advisers.
PwC have helped Irish companies expand into overseas markets, like UK, Russia and the United States and have a presence in over 150 countries including Canada and a dedicated Irish team with in-depth knowledge, experience and local contacts to provide the help and support that is needed. They can provide advice on the best structure to fit their business from a commercial, tax and financing perspective, help them with taxes, understand the risks and ensure that their business model is optimal for expanding overseas and help with employing mobile or local workers.
Andrews Tax consulting can provide help in areas such, outbound tax structuring services Country specific planning including suitability of jurisdictions with regard to banking and tax. Other Organisations that could help are DCON, Currency Fair, Bank of Ireland, Ulster Bank, and AIB Exporting.