The Significance of Social Cultural Forces in Conducting International Business
The Significance of Social Cultural Forces
In Conducting International Business
In doing business, it is better to first take an effort in conducting research and developing every proposal. The hardest challenge in the business environment is to keep the domain in the foreign land and capture the heart of the people there. And yet, there are available hindrances that involved the society. The social cultural pattern became the foundation of the lives of the people all over the world. Knowing the significance of the social cultural force and its impact on the business can be a guide of the business towards the success.
When a business planned to take a bid leap in making business in other country, the organization must be prepared to take the risk in crossing the other territorial boundaries. It is good for a business to introduce their product in the place far from them. The introduction of a product in the foreign land needs a thorough support. The competitors are flaring in the side and challenging the new business to foster the existence.
In doing international business affairs, the firm must expect much trouble than the traditional domestic affairs. The business should consider many things and options, the cause and effect, and worst-case scenario must be anticipated. After a job-well done, the business should keep doing the process and take a chance to acquire right technology, materials, people, and the demand to compensate the effort.
Common Problems of an International Business
There are difficulties in the international business environment that the firm should make a solution. These problems are also considered hindrances in the success of the business.1
1. Political and Legal Differences
2. Cultural Differences
3. Economic Differences
4. Differences in the Currency Unit
5. Differences in the Language
6. Differences in the Marketing Infrastructure
7. Trade Restrictions
8. Differences in trade practices
9. High cost of distance
The socio-cultural fabric is an important environmental factor that should be analyzed while formulating business strategies. The buying and consumption habits of the people, their language, beliefs and values, customs and traditions, taste and preferences, education are all factors that affect business. For a business to be successful, its strategy should be the one that is appropriate in the socio-cultural environment. The marketing mix will have to be so designed as best to suit the environmental characteristics of the market.2
There are people of different culture that use the same basic product, the mode of consumption, conditions of use, purpose or perceptions may vary so much that the product attributes method of presentation, positioning, or method of promoting the product may have to be varied to suit the characteristics of different markets.
The differences in languages sometimes pose a serious problem, even necessitating a change in brand name. The values and beliefs associated with color vary significantly between different cultures.
Social stigma also affects the international business, but still success of marketing depends, to a very large extent, on the success in changing social attitudes or value systems.
A number of demographic factors, such as age, and sex composition in the population, family size, habitat, religion, etc., which influence the business.
While dealing with the social environment, the business must also consider the social environment which encompasses its social responsibility and the alertness or vigilance of the consumers and of society at large.
Rules across International Business
To make the successful entry in the foreign land, it is better if the business formulated the rules in how to deal with the foreign investors.3
1. Be prepared – the business should be prepared in doing their affiliations in the other country. The tool that they have to remember is communicating. When they are assigned to present their products, the presenters should keep in mind that it is better to avoid using many slang and metaphors. They may discover trouble in vocabulary if they tried to substitute any phrase or terms that the audience understands more.
2. Slow down – when people are listening, sometimes the diction and pronunciation are hard to understand. It is better for the speaker to take a pause for every second.
3. Establish trust – a person can establish trust on the way how he speaks and through the gestures. It is also good to be precise and accurate about directions to a meeting location. Be reliable and trustworthy about time.
4. Understand the importance of language – use a translator if necessary to deliver the point of the business in a clear way.
5. Respect the Culture – know the culture of the other countries and try to make the business be fit in their tradition. Strong evidence about this section is the entertainment industry, where performers use to wear revealing clothes but it is highly restricted in the country which they chose to perform.
6. Be sensitive to different body language and different meanings of gestures – In some countries, there are many gestures that might offend them even though, the speaker is not aware of it.
7. Keep the appropriate physical space/distance and eye contact in conversation.
8. Understand that within each culture there may be strong differences based on gender, education, or religion.
To be able to construct the socio-cultural analysis, it best to start it with a research to gather the cultural intelligence. The cultural intelligence can be used effectively in determining the information about the socio-cultural or lifestyle in the certain area. It will also determine the reasonable action in the sense that it can be used in decision-making. In addition, the cultural intelligence includes perspective, theory, and method derived from the social and behavioral sciences.5
Having the cultural intelligence also means of the capability to adapt effectively to new cultural contexts and proposes constructs for recognition, motivation, and behavior.
The importance of the socio-cultural aspect in the life of the business is very obvious; they are the guidelines of the firm to make a success entry in the foreign land. If the business hooked the tastes and needs of every client, then they should expect the good fortune. If the business tried to explore the things that the customer wants, then the business should expect a growth in the sales.
The culture of a country is as important and the business should respect it. In return, the people will give the business the proper credit on it. The essence of knowing the socio-cultural on the country is that the business can establish the limitations and make alternatives out of the traditional way. The basic idea that maybe arises through this is to make an advantage over the competitors by not pushing the customers in favor of the business.
One of the business’s aspirations is make their business known in the specific area, most especially when it is known worldwide. Many international businesses succeeded in their chosen business line, and there are other more promising businesses that are waiting for the right time to make a break. Behind their success is the intensive research and broad awareness about the new market domain. They extended their market understanding and boost their market share towards the demand they seek to achieve.