1.

Outline why the culture of a country might influence the costs of doing business in that
country. Illustrate your answer with examples.

Spreading business in international market is common these days. We face challenges of cultural
diversity among countries when we break technological hurdles and accelerate towards making business
globally (Umali, 2006). Today, business atmosphere is more competitive and a bit of cultural diversity is
also included in our business environment. The challenges of cultural diversity affect the cost of running
business internationally. Culture can influence the business in various ways such as culture collisions,
pricing difficulties and language problem. The trade practices must not go against the religious
sentiments of the people. For example, beef products cannot be sold in India, since the Indians consider
cow to be a holy and scared animal and slaughtering cows in India are prohibited (Turner, 2016). Having
said that, businesses in India which involves cows may be costly since Indians consider cow as holy. On
the other hand, different businesses in western countries tend to be less costly when it involves beef
since western people love eating steak and suppliers who supplies beef in such country are prevalent.
Other examples are the Islamic countries which have their weekend in Fridays, and consider it a holy day
instead of Sunday or Saturday (Moreland, 2016). As such, this may affect scheduling business
transactions between a Christian country and an Islamic country. Additionally, in culture of Japan,
people there are considered as early risers so the timing of 8-5 is best suited for them. On the other
hand, in cold regions, work should start late, around 9-6, which would suit the locals. Having said that
businesses operating in japan would more likely to have an increased productivity than those in the cold
region. Lastly, if a company will do business in a country that has few people who can speak the
required language of the business, it may be costly. Just like if an English bpo company will open its
business in China, it will need to conduct training for its employees because Chinese are not really a
great English speakers than those in India and Philippines. Clearly, understanding the different cultural
differences of various countries will become a stepping point for success and respect.

2. Do you think that business practices in an Islamic country are likely to differ from business
practices in the United States? If so, how?

Business practices differ from country to country due to factors like cultural differences. It is with no
doubt that business practices in Islamic countries differ from those in the United States. Islamic
countries tend to preserve the religious values and tradition in business while Americans try to keep it
out of business. For instance, in the Muslim world, the law in business practices are based on the
Muslim Holy book called the Quran. The system is referred to as the Sharia which is the religious law of
Islam that governs the day-to-day aspect of its people (Halton,2019). In the U.S, laws in business are
based on the government. Another difference in business practice of both country is the language.
Generally, the United States uses English as the main language for doing business while in most Islamic
countries, Arabic and Hebrew are the most used language in business. However in Islam countries, if a
Westerner tries to speak Arabic when making a deal, it is considered to be an insult because it would
imply that such country don't speak English well enough (Lagace, 2002). Unlike in U.S whereas when a
non-English speaker tried to speak English, it is not considered an insult. Additionally, religion also plays
a vital role in doing business practices. Islamic countries are Muslim religious while U.S are mostly
Christians or Jews. In the U.S, western fashion are considered as a way of expressing and like to wear
short dresses. In Islam countries, they usually wears long veil and covered dresses (Islamic Country
Business Practice, 2016). Moreover, Islamic countries pray five times a day and consider Friday as their
holiday and they do fasting for a month during Ramadan. In U.S, they have Christmas as holiday and
refer Sunday as their holiday. Such differences are critical in doing business. Lastly, people from Islamic
countires are hospitable and generous however in some parts like Pakistan, they are not punctual unlike
in U.S so it can affect the business meeting negatively. It is fine to say that in doing business
internationally, it is efficient to know and have sufficient knowledge on the different cultural differences
that every country has so that it will be easy to overcome any sorts of uncertainty.

3. What are the implications for international business of differences in the dominant religion or
ethical system of a country?

Differences in the dominant religion and ethical system of a country might affect the business practices,
cost of doing business and the overall economic development of such country. Religion comprises
shared beliefs, values, and rituals (Aswathappa, 2008; Deresky, 2014; Hill, 2007). Ethical systems involve
codes of conduct and values that externally form a group of people’s behaviour (Hill, 2007). For
instance, some philosophers argue that an individualistic Protestant work ethic increases
entrepreneurship, the founding of new companies, and economic growth in the US and other Christian
nations.Protestantism encourages hard work and wealth acquisition (Aswathappa, 2008). However,
when it comes to Islamic countries which believes in their Allah, and live according to Sharia, believes
that Allah controls time. Such belief might result to a loose time schedule which will then result to less
productivity at work. On the other hand, some philosophers argue that the Confucian ethical system
encourages cooperation for the good of the company and improves union-management relations giving
East Asian companies a competitive advantage since Confucianism focuses on honesty, loyalty, and
reciprocal obligation. In India, American restaurants have trouble operating as Pork is considered
unclean by Muslims and Beef comes from cows that are sacred to Hindus, requiring them to offer
vegetarian, poultry, and fish rather than hamburgers and sausages. Taken together, these suggests that
the dominant religion and ethical systems of a coubtry influences international behavior as they shape
society's behavior.

4. Choose two countries that appear to be culturally diverse. Compare the cultures of those
countries and then indicate how cultural differences influence (a) the costs of doing business
in each country, (b) the likely future economic development of that country, and (c) business
practices.

(A) The cultural differences between the United States and Saudi Arabia affect the relative cost of
doing business in said countries. Due to Saudi Arabia’s strict adoption of Islamic law, banks are
not allowed to collect interest. It is prohibited to accept or charge interest (Lagace, 2002).
Another difference is the cultural emphasis on education. The United States has a long cultural
tradition of education going back to colonial New England.The United States also possesses
some of the best Colleges on Earth, many of them known as the Princeton University, Williams
College, and Harvard University (Dicker, 2016). In comparison, Saudi Arabia was a nation of
desert tribes until the discovery of oil. Education was handled by religious schools known as
 Madrassas that emphasized nothing more than basic literacy in order to read the Koran, the
Islamic Holy book. Saudi Arabian students who studied in Western Universities comprises most
of the educated sector in Saudi Arabia. The lack of an educated workforce, in fact the necessity
to import a workforce, severely raises the cost of doing business in Saudi Arabia. Another thing
is that Saudi Arabian prefer local business and employees than those in the united States. In fact
there are some programs that encourages the citizrn to purchase local goods and services
(Ramadori, 2019). This will be an obstacle for international business who wants to start a
business in Saudi Arabia.
(B) Future economic development in the US will likely remain strong due to high levels of
education, entrepreneurial spirit, acceptance of women into the workforce, and a well-
developed financial system. Future economic development in Saudi Arabia will likely be stunted
due to an insufficient culture of education, a cultural refusal to let the female half of the
population contribute significantly to economic growth, and a financial system hampered by
Islamic Law.
(C) Business practices are likely to differ significantly between the US and Saudi Arabia. A US
company might start a workday with a meeting beginning at 8am and ending at 9am with a firm
plan for the day’s work, ended with a trip to a bar to blow off some steam. Being punctual in U.S
is very important when it comes to business matters. Americans don't like period of silence
during negotiations.

Meetings in Arab countries can go on for long periods of time, long past when they were
scheduled to end, as time is an abstraction while the relationship formed in meetings is what is
important. Communication by Saudi Arabians rely heavily on non-verbal language. A moment of
silence are acceptable for Saudi Arabians as it indicates contemplation (Ramadori, 2019).

RESEARCH TASK

Go to this link: http://globalEDGE.msu. edu/

1. You are preparing for a business trip to Venezuela where you will need to interact extensively with
local professionals. Therefore, you consider collecting information regarding local culture and
business habits before your departure. Prepare a short description of the most striking cultural
characteristics involved in meeting and greeting new people that may affect business interactions in
this country. (15 points)

Greeting

Generally, Venezuelan expect a polite introduction (Venezuela, 2018). It is also expected to shake hands
whilr maintaining eye contact upon introduction. This way of greeting is usually seen in business setting
(Evason, 2019). Once people become more acquanted, an embrace is seen as a form of greeting.
Usually, this kind of greeting involves a hug followed by a pat on the shoulder or elbow for men and a
kiss on the cheek between men and women.

Gestures
When meeting for the first time, a distance usually of arms length must be considered for both men and
women otherwise it will be impolite. Eye contact is also crucial to Venezuelans as it represents trust and
high level of interest especially when someone is speaking. Touching when meeting for the first time
should not be considered. It is essential to gain trust first befire touching. Touching usually consists of
hug or palm on the shoulder (Venezuela, 2018).

Appointments

When doing or setting an appointment in Venezuela, it is acceptable to be a few minutes early than few
minutes late. It is also advised to avoid setting appointment two or three days before a public holiday
(Doing business in venezuela, n.d.).

Meeting Etiquette

When meeting with a group, it is advised to greet those persons present in the meeting and it is also a
must that when leaving, you should say goodbye to each person individually.

2. Asian cultures exhibit significant differences in business etiquette when compared to Western
cultures. For example, in China, it is considered offensive to point while speaking. Find five additional
tips regarding the business etiquette of an Asian country of your choice. (15 points)

Vietnam is a modern country in Asian continent but yet quite conservative . Its culture is unique in its
own way and it is very important for any body who is intending to make market entry and development
to understand the culture before making any actions. Here are the five additional tips with regards to
the business etiquette of Vietnam.

A. Avoid being late- Vietnamese are known to be punctual people and expect other people to be
so too.
B. Receive the business cards using both hands- In Vietnam, one should accept a business card
using both hands and should take time to read what's written on the card. Giving only a glance
of the business card is deemed offensive. It is also advisable to create a business card that has
both English and Vietnamese translations (Shira & Associates, 2019).
C. Do not try to fill in the silence during business meetings- Silence in meetings are common in
Vietnam. This only means that your partner is thinking about your interest. Trying to fill it in or
interrupting it may be considered rude.
D. Vietnamese are not frank/direct people- In Western countries, being frank or direst is common
and considered a good trait. In vietnam, direct disagreeing or asking questions in public will
most likely result for a person to 'lose face'. Face here refers to the term or concept that may
reflect a person's dignity or reputation Shira & Associates, 2019).
E. Avoid wearing bright colors as business attire- Vietnamese are fond of modest business attires
and avoids wearing bright colors. Although business attire may differ depending on the location
of the meeting.