Effect Of Cultural Differences On International Operations A Comparison Of China, Japan, And Oman

Effect Of Cultural Differences On International Operations: A Comparison Of China, Japan, And Oman

Contents

TOC o “1-3” h z u 1.1 Aim of the Study PAGEREF _Toc376339353 h 11.2 Background of the Study PAGEREF _Toc376339354 h 1Methods PAGEREF _Toc376339355 h 22.1 Secondary Sources PAGEREF _Toc376339356 h 22.2 Primary Sources PAGEREF _Toc376339357 h 22.2.1 Preparation of Questionnaires PAGEREF _Toc376339358 h 22.2.2 The Questionnaire PAGEREF _Toc376339359 h 22.2.3 Procedure of Administering Questionnaires PAGEREF _Toc376339360 h 3Results and Discussion PAGEREF _Toc376339361 h 33.1 Negotiation Skills and Leadership PAGEREF _Toc376339362 h 33.2 Personal and Interpersonal Relationships PAGEREF _Toc376339363 h 53.3 Attitudes and Beliefs PAGEREF _Toc376339364 h 7Conclusion PAGEREF _Toc376339365 h 94.1 Oman PAGEREF _Toc376339366 h 94.2 Japan PAGEREF _Toc376339367 h 9Recommendations PAGEREF _Toc376339368 h 95.1 Negotiation Skills and Leadership PAGEREF _Toc376339369 h 95.2 Attitudes and Beliefs PAGEREF _Toc376339370 h 95.3 Personal and Interpersonal Skills PAGEREF _Toc376339371 h 10

Introduction

1.1 Aim of the StudyThis paper will look into the cultural differences between china and two other countries — Japan and Oman, and examine how Chinese citizens understand these differences. This study is part of a report requested by the company CEO as the company seeks to diverse into Japan and Oman markets. The CEO needs to gauge the cultural differences between the two economies with the Chinese economy, and investigate how Chinese people understand these differences. The paper will focus on three cultural differences: personal and interpersonal relationships, negotiation skills and leadership, and attitude and beliefs.

1.2 Background of the StudyMost managers and business owners consider economic and technological factors to be the only factors affecting success of international operations. Although most managers have formulated strategies to address economic and technological differences when putting up business in different economies, most businesses continue to collapse or struggle for a long time (Bonvillian & Nowlin 1994, p.44). This can be attributable to cultural differences that affect the way of doing business in different countries, but that affect the performance of the business (Mead & Andrews 2009, p.15). This has been the case with Wal-Mart in U.K., Starbucks in Europe and Google in china, where in spite of their powerful models and marketing strategies, they failed to get results in these markets. Understanding of cultural differences is important for a new operation in a different country because it paves way for understanding consumer behavior. Cultural aspects influence customer behavior such as consumption habits, marketing, acceptability of products and customer service perception (Travis 2007, p.20). This study uses primary and secondary sources to investigate cultural differences between the three economies. The paper then formulates recommendations for the business that is considering putting up operations in Japan and Oman.

MethodsThis section will describe the methods Used to collect data for the study. The paper relied on both primary and secondary sources for data collection.

2.1 Secondary SourcesData from secondary sources involves using materials that have been compiled through previous researches in the same field. Secondary sources of data include internet, where studies in databases from educational journals and periodicals. Other reliable secondary sources include books and magazines that are available online and in print. Secondary sources of data to compare the findings from other researched with findings from primary data sources. This study relied on secondary sources that used various dimensions of culture to explain Japanese, Chinese and Oman culture. The study heavily relied on journals and studies that present the analysis of the three cultures using Geert Hofstede’s model. The study will also use studies that describe the culture of the three countries in general to capture other attributes and dimensions not included in Hofstede’s model.

2.2 Primary Sources

Primary sources involve going to the field and collecting raw data from respondents that are important for understanding of the topic under study. The respondents will give their experiences and understanding as guided by issues raised in the questionnaires.

2.2.1 Preparation of QuestionnairesThe questionnaire was prepared through a rigorous process with the guidance of fellow students and regular reviews from the teacher. Preparation involved three stages, all of which required the approval of the lecturer. The questions were prepared and presented to the lecturer, who gave them back and with suggested corrections. The next step involved testing the questionnaires using fellow students. This is important to establish the understandability of the questions, the ease of answering the questions by the respondents and relevance of the questions to subject of study. After corrections at this stage, the questionnaires were returned to the lecture for approval.

2.2.2 The Questionnaire

The questionnaire contained 10 questions. The study targeted 20 employees in the company that had at one point interacted with employees or business owners from Japan and Oman. The questions were semi-structured to guide the respondent and at the same time, allow the respondent to give as much information as possible; given this is a qualitative survey. The idea is to ensure that all the three characteristics and their elements are captured. [See appendix 1 for the questionnaire item].

2.2.3 Procedure of Administering Questionnaires

The questionnaires were administered by hand since most of the employees were accessible within the company premises. Most of the employees preferred to have their questionnaires delivered through email. The questionnaires were collected after one week through e-mail and hand delivery. The target was 100% return of the questionnaires. The respondents were 12 men and 8 women; 80% of the respondents were in managerial position. Employees in management position interact often with other managers and employees from other countries.

Results and Discussion

All the 20 respondents returned their questionnaires within the 1-week period.

The results of the survey were grouped into three main elements: leadership and gender, attitude and beliefs, and personal and inter-personal relationships.

3.1 Negotiation Skills and LeadershipThe inferences for this dimension were drawn from question 1 to 5. These questions were investigating communication culture differences between the two countries, language –verbal and non-verbal, negotiation skills and time management.

Fifty percent of the respondents believed that Chinese are better managers than Japanese, while 43% thought that Omani made better managers than Japanese. Thirty percent feel that Japanese are better managers than Chinese and Japanese.

The figure below shows the perception of survey respondents on the ability of people from the three countries to become good managers owing to their cultural orientation.

Figure 1: A pie chart showing how culture influences the ability of people to become good managers

Sixty percent of the respondents said that it is easier to do business with Japanese than Omani. They gave the reason that Japanese are on time and punctual and that they are quicker to make decisions compared to Omani. About their home country, 68% pointed out that the two countries were very slow in making decisions compared to Chinese managers. Another 28% of the respondents felt that there was little difference between Japanese and Chinese way of doing business. The survey also showed that 85% percent of the respondents have not encountered a Japanese or Omani woman manager. The figure below shows cultural differences between Japan and Oman in terms of negotiation skills, punctuality, and women in leadership and decision-making.

Figure 2: A comparison of cultural attributes between Japan and Oman

lefttopAccording to research findings from secondary sources, the study relied on research papers and Geert Hofstede’s model. Japanese have an elaborate hierarchical structure in the society that replicates in business (The Hofstede Center, 2013). This slows decision-making process and lengthens decision-making process. However, research show mixed results for Japanese time orientation. Most studies show that Japanese regard punctuality as a show of respect, and currently a form of value addition. For instance, the JIT system is an indication of Japanese long-term time orientation. Omani is short-time time oriented because they do not value punctuality and prioritize other things such as family and friendship.

3.2 Personal and Interpersonal RelationshipsMost respondents – 69% think that Omani are less friendly to strangers, while 64% think that Japanese are unfriendly as well. Fifty-three of the respondents indicated that the Omani businesses they interacted with were made up of family members. Eighty percent of female respondents said that they were uncomfortable when interacting with male business partners from Oman.

In terms of courtesy in communication and business negotiations, there were mixed results. Fifty percent of the respondents felt that Japanese are disciplined and use words sparingly. They also rely on non-verbal communication to show respect and agreement according to 67% of the respondents. The respondents showed great similarities between Omani and Japan in terms of business etiquette. Seventy-five percent of the respondents said they would require business etiquette training if they were to work in Oman or Japan (76% for Japan and 74%for Oman). Doing business with Oman and Japan clients requires more time and good listening skills according to the survey. Seventy-five prevent of the respondents said they encountered language barriers with Oman clients because they prefer communicating in their own language. The following diagram can demonstrate these findings.

Figure 3: A comparison of business and language barrier between China, Oman and Japan

Japanese and Omani are less friendly during their negotiations because they Japanese are secretive, use high-context language like Chinese, while Omani hang onto their values too much and prefer to use their language. Secondary sources show that Japan is masculine society where men are highly competitive as they fetch for success, and women do not play significant roles (The Hofstede Center, 2013).

Japanese society has a homogenous culture, and a close-knit structure based on respect and impressing other people (Nelson 2009. Just like Omani, they are keen on saving faces, and their decisions are heavily influenced by other people’s perceptions. As a result, they display firm loyalty to their employers. Omani society highly values family relationship, and it is a common place to find an entire workforce comprising family members (Aycan, et al, 2007, p.15). A comparison with the Chinese culture using the Hofstede’s model shows that china is a collectivist society. Chinese are generally sociable and uses formal and figurative language (The Hofstede Center, 2013). Family bonds are not so strong and inequality is widely accepted.

3.3 Attitudes and Beliefs

Attitude is a wide concept, and in this study, it was meant to capture aspects of religion, permissiveness to new opportunities and ideas, risk taking and gender roles. Out of the 20 respondents, 84% believe that Omani is too conservative and still hold on to family values and traditional gender roles as depicted by their women’s dressing. Women are expected to dress according to Muslim laws when they interact with men. 70% of women that had interacted with Omani in negotiations reported that they had difficulties dealing with them. They also hold keep off from people that do not respect their culture and uphold all their values in business transactions. For instance, since most of them are Muslims, they inculcate Sharia laws into their business deals according to Aycan, et.al (2007). They also expect certain form of greeting and use of specific words to welcome people or show gratefulness.

Another 60% noted that Omani are not keen to follow lengthy procedures and are keen on creating connections and rapport with partners. This is much similar to the Chinese attitude of creating rapport with potential clients for instance through Guanxi (Ruixiang, 2012, p.78). Therefore, business deals for both Chinese and Omani heavily depend on interpersonal relationships. The survey also showed that Japanese are keen to follow all legal procedures when dealing with people since they are keen on reputation and have high levels of conformity to legal and communal issues. This was supported by about 69% of the survey. The study also showed that Japanese have negative attitude towards risks as 77% of the respondents admitted that they have to be sure about a venture. Secondary sources show that Japanese are innovative, but they avoid risks due to natural disasters and social factors. Compared to Chinese, that got 20% in risk avoidance from the survey. The following diagram can demonstrate the differences in attitudes and beliefs by classifying into risk avoidance, religion, face and conformity and friendliness.

Figure 4: Differences in Attitudes and Beliefs between China, Japan and Oman

As a result, the figure bellow will summarize the ease of doing business in the three countries based on the findings from primary and secondary sources. The diagram shows that China ranks high in terms of doing business because it has the least cultural barriers compared to Japan and Oman.

Figure 5: Ease of doing business for the three countries based on the cultural differences and barriers

Conclusion

A Chinese company that is preparing to establish new businesses in Japan or Oman should be prepared the wide cultural differences existing between the two economies. A comparison between survey findings and secondary sources show that the company employees understand the cultural differences between the three countries. In a scale of 5, the understanding can be classified around 4.

4.1 Oman

Oman has a closely-knit culture where people value family and interpersonal relationships, as opposed to China, which is dominated by individualistic culture. As a result, there is lengthy decision-making process and business process in Oman compared to china. Gender roles also differ in that, Oman places submissive roles among women and so women rarely take up leadership roles. Omani also places high expectation on religion and appearance unlike china. There are a stricter, more ethical requirements and language barriers in Omani than in china.

4.2 Japan

Unlike Chinese that are individualistic, Japanese are conformists, are keen to earn respect and protect their dignity. Chinese are risk takers while Japanese are risk avoiders. Chinese are forward, open to new ideas, and use informal language. Japanese are secretive, take long to make decision and lack autonomous thinking.

Recommendations

5.1 Negotiation Skills and LeadershipThe company should educate its employees on cultural awareness. As employees move to different cultural settings, they need skills to tolerate new culture and ways of approaching customers and business partners as per their orientation. It is also important to educate managers on the basics such as greetings, non-verbal communication and formulation of strategies that are consistent with cultural expectations.

5.2 Attitudes and Beliefs

Employees need skills on emotional intelligence to operate in new cultural environments according to Bonvillian & Nowlin (1994). This can be achieved through recruitment or promoting culture of diversity and inclusion within the organization. At times, the employees may be forced to dress and learn the language of the new cultural setting. Alternatively, the company can hire employees of the same descent (Mead & Andrews, 2009). Travis (2007) shows that marketing strategies such as advertisements should be researched well to avoid conflicts.

5.3 Personal and Interpersonal Skills

The company should select employees with good interpersonal skills. The company should carry out research on the expectations of the society, their eating habits, use of words and etiquette.

References

Aycan, Z, Al-Hamadi, A, Davis, A, & Budhwar, P 2007, ‘Cultural orientations and preferences for HRM policies and practices: the case of Oman’, International Journal Of Human Resource Management, 18, 1, pp. 11-32, Business Source Complete, EBSCOhost, viewed 12 September 2013.

Bonvillian, G, & Nowlin, W 1994, ‘Cultural awareness: An essential element of doing business abroad’, Business Horizons, 37, 6, p. 44, Business Source Complete, EBSCOhost, viewed 12 September 2013. http://ehis.ebscohost.com/ehost/ebookviewer/ebook/nlebk_279162_AN?sid=695d6b4d-6069-495e-b4c0-0eee2a18293f@sessionmgr111&vid=2&format=EB&rid=3Mead, R, & Andrews, T 2009, International Management: Culture and Beyond, Chichester, England: John Wiley & Sons, eBook Collection (EBSCOhost), EBSCOhost, viewed 12 September 2013.

Nelson, CA 2009, Import/Export: How To Take Your Business Across Borders, New York: McGraw Hill, eBook Collection (EBSCOhost), EBSCOhost, viewed 12 September 2013. http://ehis.ebscohost.com/ehost/ebookviewer/ebook/nlebk_279698_AN?sid=121a686c-7429-468a-b78c-a639d64c17ce@sessionmgr4&vid=7&format=EB&rid=11Ruixiang, W 2012, ‘Chinese Culture and Its Potential Influence on Entrepreneurship’, International Business Research, 5, 10, pp. 76-90, Business Source Complete, EBSCOhost, viewed 12 September 2013.

The Hofstede Center, 2013, ‘What About China’ The Hofstede Center, viewed 12 September 2013 http://geert-hofstede.com/china.htmlThe Hofstede Center, 2013, ‘What About Japan’ The Hofstede center, viewed 12 September 2013 http://geert-hofstede.com/japan.html/

Travis, TG 2007, Doing Business Anywhere : The Essential Guide To Going Global, Hoboken, N.J.: John Wiley & Sons, Viewed 12 September 2013. http://books.google.com/books?id=3MM7znHdHzgC&pg=PR2&lpg=PR2&dq=Doing+Business+Anywhere:+The+Essential+Guide+To+Going+Global&source=bl&ots=q137dXmqed&sig=i3DYRlJgAS7sSTtUQAnwakmkuQA&hl=en&sa=X&ei=KgI3UtDDI7ai4AOS4oGQCA&ved=0CF4Q6AEwBg#v=onepage&q=Doing%20Business%20Anywhere%3A%20The%20Essential%20Guide%20To%20Going%20Global&f=falsAppendix 1: Questionnaire

Have you interacted with Japanese or Omani – people from Oman? If yes, in what capacity?

What do you think is different about how Japanese and Omani negotiate business deals compared to Chinese?

How do Japanese and Omani treat strangers?

How would you describe Japanese and Omani decision-making process? Do they care about group values or do they make individual decisions?

Was it easy doing business with Japanese and Omani? Were their barriers to communication?

Did you encounter women mangers or business owners? What is your view of women leadership in business in Japan and Oman compared to china?

If you were allowed to work in Japan or Oman, what would you learn to do differently from your usual routine in china?

How would you compare Japanese and Omani managers with Chinese mangers in your company?

Would you classify Japanese and Omani as risk takers? Explain.

What do you think motivates Japanese and Omani in business? Do they want do what they like or is about success, competition and achievement.