This sample assessment is about:
- Introduction about culture
- Characteristics of culture
- Impact of differences in culture on international business
Culture demonstrates the social behaviour customs, ideas and norms of humans which reflect their society and life style. It is implied in communication, way of living and working (Cruickshank, 2016). Culture plays a crucial role while doing international business as in this, the management aims at exploring its products and services among people of different cultures. Indian culture is known as the mixture of different values, beliefs, norms and religions. Thousands of distinct cultures and communities are the part of India (Discuss Culture and Personal Culture, 2016). It is the birthplace of various religions like Sikhism, Jainism, Hinduism, Buddhism, etc. However, Indian culture was highly influenced by invasion rulers who emerged with different philosophies like Turkish, Arabic and Persian.
Culture is a social behaviour of people which represents one human population that is people with similar beliefs, values and norms. It can be considered as influence, learning and interaction of different people which promotes learning. Further, it can be said that it is a symbolic communication which promotes individual behaviour and ethics towards different people in society. It can be argued that culture is shared and has significant facts which represents one group of society. For example Christmas tree is ceremonial objects Christians across the globe. However, the major cultural differences is seen in people of different countries like the assessment is based on two countries that is UK and India. As per historical beliefs and practices culture is as a high degree of taste, knowledge and interest in literature, arts and other scholarly fields.
India is a developing mixed economy and is ranked as the sixth largest by nominal GDP and 3rd largest with regard to purchase power parity. The economy was ranked at 139th position with $2,134 per capita GDP and 127 with $7,783. The present Gross Domestic Product rate of India is 7.36 % and it is expected to rise in 2019 by 7.79 %. The country has most favourable economy among Brazil, Russia, India, China and South Africa.
However, the country is considered as culturally diverse and rich in varied factors like, religion, caste, language, etc. The business approach of Indian people is based on behaviour, etiquette and professional changes. The country is multilingual and everyone follows their official languages but the business culture of India prefers English and therefore it is followed religiously in every sector. Further, meetings, courtesies and greetings are crucial part of Indian culture where the people greet each other by saying Namaste but in business people introduce themselves by handshake and slight nodding.
Apart from this, the business relationship of people in India completely depends on their trust and relationship with other person. Moreover, the best part of Indian business culture is value of customers where the management and enterprise are focused on producing and manufacturing goods according to needs and wants of customers. In addition, the motive of Indian organisation is to gain trust of buyers by serving them best services. Likewise, organisational meetings are organised in advance and confirmed by writing mail or by phonic conversation (India Business Culture, 2018). The best practice followed by Indian industries is avoiding work and meetings on national holidays that is independence and republic day, Gandhi birthday and also on festive like Diwali, Raksha Bandhan, etc. Value of time is priority for Indian people and families are given are considered on top of priority list.
United Kingdom is an island nation located in north Western Europe and comprise Scotland, England and Northern Ireland. The culture of UK is influenced by ancestors where the country owns great power and liberal democracy. The country is predominantly based on Christianity where people have different customers, norms, cultures and symbols. Some of the popular trends of UK are, Christmas, New Year’s Eve, Boxing Day, Guy Fawkes Night, etc. The country is famous for its educational institutions. In addition, it can be said that British culture has its own roots and it is amongst the richest culture across globe.
Country is the most influential centre of world in culture, politics and finance. The two official languages of country are Welsh and English and more than 90% of population speaks English. The people of UK fear embarrassment because of which individuals are unable to share feelings which leads to misunderstanding and business offences. The British culture is focused on privacy requirement of people which limits communication among people and therefore country lacks informal interaction especially at workplaces. The best part of Britain culture is polite behaviour and honest opinion which reduces risk and errors.
In UK business culture, it is important for professional people to share clear messages because the workplaces do not entertain assumption and hidden meetings. The focus of organisation is on maintaining transparency at workplace (British business culture, 2018). Further, the enterprises organised business trips where informal relationships are encouraged with the motive of maintaining positive workplace environment. The motive of Britain business culture is to maintain long term relationship with employee and therefore the management aim at valuing politeness, privacy and interest of workers with an organisation.
On the other hand, educations standards of country are very high which help enterprise in managing recruitment of qualified candidates. Cultural prohibitions in UK are very strict and mandatory to be followed in order to begin profession relationship. Some taboos are, greeting unknown person with kiss, spiting at public places, basic gestures like, greeting unknown person or backstabbing people. Likewise, it is important for the people to avoid discussion over religion, partisan politics, race, children, age, weight, appearance, historical conflict in Northern Ireland and many more issues.
Corporate social responsibility is the crucial part of business organisations in UK, as it helps the enterprises in managing stable growth and sustainability in business performance. CSR polices help entities in effective management of workplace issue like, human rights, employment, work life balance, etc. The procedure helps the firms of UK in community contribution which denotes efforts of business in economic contribution. Implying CSR objectives and places assist the firm in gaining governmental support and attaining public support to accomplish business goals and objectives(Cruickshank, 2016). Thus, on the basis of introduction, it is evaluated that both the countries have completely different economic environment. Like the growth of Indian economy is limited to few sectors whereas industry of UK grows as whole to contribute in economic growth and development.
Cultural diversity is the quality of various cultures, as opposed to monoculture, the global monoculture, or a homogenization of cultures, related to cultural decay. The expression cultural variety can also refer to having different cultures respect each other's differences.
The study will outline concept of culture and its characteristics which will help in differentiating between culture of two different countries that is home and host country while doing international business. The assessment will help in understanding impact of culture on foreign business as it is influence by diverse language, beliefs, values, norms and cultures. In addition, it will identify various dimensions of cultures that is collectivism, individualism, short term and long term orientation, tolerance to inequality, differences in languages, etc. The discussion is focused on two countries that is India and United Kingdom for which it will outline economic background of both the economies. Thus, it will provide strategic recommendation which be helpful for the business person for international communication.
Culture and characteristics of culture
Culture is a set of beliefs, myths, norms, regions and values followed by each individual. Every person in world have own distinct identify which is reflected by their culture. Group of people working together follows different culture and is used by person in different ways. It is the concept which is passed from one person to another via learning or heredity (Valentine, 2017). Culture comprise non material values which is represented in one’s beliefs, norms, morals, values and languages while physical evidence of philosophy are architecture, object which are made by ancestors. It is considered as total of beliefs, artefacts, rules and norms which represents specific human population.
Culture is wide range of social habits, language, arts, music, language and religion of people which depicts individual unique identity (Schech, 2014). Culture is an aspect which helps in differentiating among people of two families countries or regions. It gives society own identity with the help of its characteristic symbol that is learned, shared, symbolic, integrated, and dynamic.
Definition of Culture by different authors
As per the views of Edward Burnett Tylor, culture is a complex philosophy which comprise law, custom, morals, arts, belief, habits and other capabilities of man in one particular society (Various definitions of culture, 2007).
According to A.L. Kroeber and Clyde Kluckhohn statistical fiction, learned behaviour, ideas, physic defence mechanism and logical construct of one demonstrates culture of that person.
Damen, L. stated that culture is learning of person which is adopted by person in shared human patterns of day to day life.
According to Bierstedt, Culture is the complex whole that consists of everything we think and do and have as members of society.
In accordance with discussion over concept of culture, it can be said that culture is behavioural patter of one person which is denoted in human action and is inherited. it is passed from generation to generation is ongoing which can be transformed but cannot be completely changed. Every culture, norms, values seems to change with time but cannot be completely eliminated. It defines number of ways of human interaction but is considered as shared and learned behaviour (Schneider, Ehrhart and Macey, 2013). However, it can be argued that this is the concept which helps in differentiating identity of two people. It is a consisting primarily of the ideational, intangible and symbolic, aspects of human civilizations.
Characteristics of cultures
The concept culture is shared reflects common beliefs of two people which is reflected in their communication, values and norms. It is possible that two people follows same beliefs but in two distinct ways. Moreover, there are numerous people across globe who share same religion but follows different practices (Cox and Soobiah, 2018). Shared culture characteristics helps in managing innovation, correspondence and social dynamism. Shared culture concept demonstrates use of same symbols, tradition, practices which are influenced by each other. It promotes communication an interaction of two different people.
Participation of people in festivals ad rituals of society indicates characteristics that culture is shred. In this situation people from different cultures aim at exploring ritual, ceremonies and practices of different people where the people of society shares each others values which, is the best way that promotes equality and sense of belongingness among people of different cultures (Cruickshank, 2016).
Culture is learned
Transmission of culture from one person to another implies learning. This occurs when people with distinct culture lives in one society. The interaction of two people for any purpose that is friendship business, etc. promotes cultural learning (Smith, 2017). Likewise, it can be said that cultural learning is beneficial for economic development as it promotes innovation and grouping of diverse people for one specific purpose. One of the best example of culture is learning is demonstrated by recruitment if immigrants in an organisation. In addition, expansion of business across international boundaries also encourages cultural learning which is beneficial for host country as well as home country (Dealing with Cultural Differences in International Business, 2015).
Sharing and involving with people of different cultures reflects learning characteristics of culture. For example, when the people gets involved with each other fr the purpose of something like, friendship, business, relationship then it promotes learning over different cultures. Learning is the characteristics which do not harm any person values and beliefs but helps in exploring different way to thinking and act ethically. Learning of culture is reflected when the people works together with the motive of accomplishing something. The learning is not exception is followed with regular involvement of people with different culture like, international business, education, etc.
Culture is cumulative
Culture is based on one particular ideal pattern which is followed by generations to generations. However, addition of new situation, norms, knowledge and skills to enhance value of culture by people denotes cumulative culture (7 Major Characteristics of Culture That Are Essential for Life, 2018). It is normal according to changing behavioural pattern of society. It helps in understanding changes according to modern era where people add own touch according to changing mentality and by learning from different cultural philosophies. According to Sarala and Vaara, 2010, culture is cumulative because every human has potential to discover new things and own thinking to values, beliefs, rituals, etc. The term represents learning, modification, and accumulation of improved cultural beliefs and practices.
Cumulative characteristic of culture reflects inheritance which is continuous. Like the family is continuous has follows same norms and values. However, there are some minor changes which are added generation to generation. The changes are modification and added new touch to cultural values but it does not change entire beliefs and norm of one culture. Like instantly Diwali was a festival of welcoming, lights and crackers. Now there are various changes which have been added by Indian society like, exchange of gifts, incentives and bonus at workplace, less of crackers and more of peace, etc. Thus, it can be said that cumulative culture denotes chances where cultural practices, and rituals of society are constant.
Culture is integrated
Integration is a process of exchange of beliefs and values. It is inspired by learning where the one sacrifices own culture to practice beliefs and norms of other culture. The integration concept of culture leads to diversity in society which is most beneficial approach of managing stability of people and improving standard of living. Integration values and beliefs helps people in exploring different cultural rituals which demonstrates unique meaning of every basic day to day activities. Integration of culture is majorly reflected while doing international business where the enterprise focuses on expanding business functions with the motive of integrating different concept to enhance value of firm and its organisational functions. Similarly, as per the views of Martin and Nakayama, 2013, integration culture is a characteristic which helps in eliminating discrimination in society and promotes equality for all humans.
Integration of culture is supported by learning and sharing. It denotes individual interest to involve and practice different cultural practices and values. This is done with own willingness where person aim at exploring and adopting different cultural practices. It is the characteristic which promotes cross cultural participation and involvement of people (Cruickshank, 2016). In this people can even sacrifice own culture with own willingness which depends on ability to think in terms of symbols. Thus, it is effective approach because helps in exploring uniqueness of different cultures.
Culture is symbolic
Transmission of culture in form of symbols is denoted in generations. It presents beliefs and rituals followed by specific group of family member. In this the individual lives same type of dance, music, fest, artistic activities which is the symbol of culture. However, as per the views of Lee and Sukoco, 2010, symbolic characteristics of culture is an evidence which reflects older generations and cultural belief followed by ancestor of particular culture. Moreover, the scholar discussed about symbolic culture which is studied and evident by sociologists, archaeologists and social anthropologists. It is considered as ability of generations to transmit and learn traditions of customs of culture. Apart from this, basic cultural symbol is reflected one’s behavioural pattern and gestures towards society.
It denotes individual ability to learn and adapt different cultural values and beliefs. It is the leaning and transmission of behavioural traditions from one generation to the next by the invention of things that exist entirely in the symbolic realm (Savage, Barlow and Fielding, 2014). It is commonly followed across the globe because symbolism is when something represents abstract ideas or concepts. Thus, it can be said that symbol culture helps in developing clear understanding over concept of different cultural beliefs, norms and values.
Culture is social
Culture denotes collaboration of people and their values and beliefs. It related to people of same culture and other culture but at the end it integrates society together. Socialising culture encourages norms and values of different people as one community (Ardichvili and et.al., 2012). Moreover, socialising culture characteristics is the basic practice which empowers innovation and generation of unique ideas. In this, humans with different beliefs socialise together with one common motive which is change for society as a whole.
Social characteristics of culture promotes sense of belongingness among people from different countries and cultural backgrounds. This helps the people in managing positive relationship with different kinds of people. The place which denotes social characteristics of symbol is business, educational institutions, public place, etc.
Impact of differences in culture on international business
International business is concept of cross border commerce where the goods and services are traded beyond domestic market in order to explore markets across the globe. It is done to expand business with the motive of increasing market share and consumer base. The key economic benefits of foreign business are, decrease in market fluctuation, cost effectiveness, long term investment, innovation, increase in production efficiency and variety of commodities (Frank, Kessler and Fink, 2010). Foreign commerce is important for an organisation because it helps in diversifying and expanding services. In this the management is able to produce high quality of good and services at low price which assist in managing cost effectiveness.
There are various factors which defines impact of cultural differences in international business. The foremost factor of difference is communication which denotes linguistic barriers among people of two different countries. Cross cultural interactional leads to challenges like, sensitivity, openness and curiosity. Further, there is huge difference is workplace etiquette because every culture offers different way of professional interaction (Hollins, 2015). The major difference which will impact international business ability of India and UK is scheduling of activities because of differences in time. Further, there are huge differences in working hours, work life balance, policies and other employees rules and regulations.
Organisational hierarchy is another difference when impact international business because the role of management differs between cultures (Cruickshank, 2016). For example in India hierarchy is positioned when employees lack communication with management which leads to conflict among supervisors and workers. In accordance with the tall structure of organisation leads to biased decision making which hamper employee productivity. On the other hand, the business organisation of UK have formed flat division structure where departments are divided according to functional units but employees are placed at equal level which promotes communication, information management and increase in workers productivity. This structural distribution in organisation promotes supportive growth which helps in easy management of differences.
International business is majorly impacted by differences in culture, where the management needs to focus on meeting demands and wants of diverse population group. The most challenging part international commerce in matching up with the needs of distinct cultural groups. It is necessary for the enterprise to innovate products and services for society as whole. According to Salacuse, 2005, when doing commerce at international level then the firm is not just limited to cross borders instead it has to manage cross cultures. Culture is the concept which influences thinking, interaction and behaviour of every individual which impacts transactions and way of negotiation. Cultures leads to great diversity which makes it extreme difficult for business to coordinate and negotiate with people of different countries. Therefore, when doing international commerce, it is necessary for the firm to have experienced negotiator who holds critical understanding over different cultures. At the time of international business, it is necessary for a firm to value beliefs, values and religious concern of particular country because not complying with cultural norms can lead to unethical business practices.
Differences in culture leads to various challenges when doing international business like, goal of negotiation that is relationship or contract. On the basis of survey of 400 people it is analysed that as per 74 % of Spanish participants their negotiating goal is focused on contract, to which only 33 percent of Indian agreed (Dealing with Cultural Differences in International Business, 2015). This denotes that as per Indian culture negotiation goals is not just a contract but is relationship and contract is way to present the association. Further, the difference in culture affect negotiation attitude which depends on two situations that is win-win or win lose. In this the focus of negotiator is on collaborating opinion of two people with distinct cultures (Keller, 2014). It is the problem solving process where the focus of negotiator is on making both parties understanding the importance of partnership and agreeing to term and condition. Considering cultural beliefs and value of both parties is the only solution which helps negotiator in successful negotiating.
Cultural differences majorly impact international business because home country is completely different from host. For example the population of India is diverged towards masculinity compass whereas people of Britain focus on proving equivalent opportunity to all people. Culture plays a crucial role in international expansion of business and has positive and negative impact of business. On of the biggest example of internation expansion and influence of culture is Amazon which is multinational internet retailer which has adopted various changes in products and services according to Indian market and cultural trends. Initially the products and departments of company comprise only western clothing and products according to market and requirements of UK. However, at the time of expansion the company conducted market research about Indian wears and adapted to different cultural products in different departments. Now the firm offers wide range of commodities according to different shoppers. The focus of firm is on meeting customer expectation by diversifying its product range (Lawton, 2012). In addition, the discounts, offers, sales and product schemes are also organised and offered by company according to festivals of different culture. This is the strategy which helped the business in boosting sales when expanding internationally. Hence, it can be said that it was the step which helped the business sin growth in different market with consumer acceptance.
As per the views of Nicholson and Salaber, 2013, communication affect international business because way of interacting varies according to cultures across the globe. Communication is based on two forms that is indirect and direct. People with distinct culture have different opinion of interaction way. For example, according to Japanese indirect way of communication is disapproval. Moreover, sensitivity to time is another variable of difference in culture which impact international business. Like Latins people are always late and slow in making decision where Germans are extremely punctual. However, Americans are very quick in making deal while Japanese take time to confirm and finalising associations.
Sarala and Vaara, 2010, has discussed about positive impact of differences in culture on foreign business, with the help of which firms are able to manage innovation in services. The author discussed about collaboration and coordination of efforts of distinct cultures altogether. The cooperation of different culture helps the entity in understand consumer requirement while doing business across international boundaries. It is an effective approach because exploring different cultures helps enterprise in determining common differences and interests which can be managed to address gap while doing international commerce. On the other hand, Nicholson and Salaber, 2013, discussed about mutual understanding among people of different culture to attain success while doing international business. The scholars stated that understanding over distinct cultural norms, philosophies and values helps the firm in attaining competitive advantage. Also, it becomes easy for the consumers to accept products of internal organisation when it values their beliefs and norms.
In accordance with internal business, it can be said that culture is the basic factor which hinder foreign commerce for which it is necessary for the enterprise to acquire 5 basic skills that is communication, innovation, self-awareness, collaboration and resilience. Naor, Linderman and Schroeder, 2010, has stated that cultural differences are common as individual differences which can be managed via effective interaction and integration. While managing international commerce the foremost responsibility of management is to bridge gap of individual differences by accepting and recognizing differences. This strategy helps in overcoming cultural differences and managing successful international business operations. In addition, it can be said that it is important for the business to be focused on task and success of international commerce which can help the enterprise in gaining different ways to overcome differences. It is important for an organisation to focus on dives recruitment when doing business across foreign boundaries. This strategy of staffing can help the firm in managing employees of varied culture who can assist in dealing with challenges which arise due to cultural differences.
Differences in cultures is the basic factor which hinder international trade. For example, business of India when expanding in UK need to focus on demands of Britain society and their way of developing professional relationship. Likewise, HR manager of particular firm will be responsible for hiring staff from UK in order to insights over market trends and fluctuations. In accordance with this, it is necessary for the enterprise to make use of unique market strategy in order to grab attention of citizens. However, when selling and marketing products and services, it is essential for management to comply with legislation, cultural values, norms and religious concerns of people (Vaara and et.al., 2012). Hence, as per the discussion, it can be outlined that market research of host country plays a vital role when doing international business.
The major cultural difference in home and host country occurs at the time of acceptance where negotiation plays vital role where two parties of different cultures focuses on agreeing on one condition with mutual interest. In accordance with this situation, it is important for the people from different countries to value each others' opinion and cultural differences. When doing business across domestic boundaries it is necessary for the organisation and people to focus on equality and diversity. It is the concept which promotes respects and value of individual rights and beliefs. It helps in protecting human rights and values of different people working together. Thus, it can be said that promoting equality diversity when doing foreign business helps the company in managing ethical practices which aid in protecting individuals beliefs, norms and values.
Economic Background of India and United Kingdom
Developing understanding over economy of home and host country plays a significant role in managing cultural differences and determining growth of foreign commerce. Studying economy of two country helps in analysing key determinants of success and future advantages to firm. Economic condition of UK and India are completely different from each other and therefore managing business across UK will be beneficial for the entity in remarking success.
Global Financial Crisis of 2008
The basic features of Indian economy are low per capita income, high rate of population growth, lack of technology, unequal distribution of wealth and income, poor rate of capital formation, chronic under employment and unemployment, poverty, increasing health concerns, dependence on agriculture industry and poor education standards. The economy has low er capital income if compared to developed economies (What are the main features of India's economy?, 2018). However, only 14. 2% people are dependent on every other sector of economy whereas 53 % of total Indian population is dependent on agriculture industry.
Further, ever decade there is increase in Indian population by 20 %. For example, in the period of 2001 to 2011 the Indian population increased by 17.6 %. In addition, the income disparity among people denotes uneven distribution of wealth like, 1 % rich people of country owns 53 % wealth of whole country. Further, in 1993-94 domestic capital formation was 23.3 % which increased to 23.3 % to 2008 and till 2013, it raised up to 34.8 %. Apart from this, it is determined that 97 million people do not have safe drinking water and approximately 840 million do not have proper sanitation and are suffering from chronic health concerns. The economy has outdated technology because of which the people are not aware about technological changes and up gradation. Thus, it can be outlined that the major case of declining or moderate growth of economy is lack of individual interest in economic and business activities. Society is focused own benefits and interest regardless of managing changes in society as a whole.
Economy of India is known as developing mixed economy and it analysed from success of trading and agricultural society. The accomplishment of economic condition of India is reflected in its urban development and trading activity. However, growth of India has been unbalanced across all areas that is rural and urban nut still known as fastest growing economy because the country had rapid growth. Apparently, there was slow decline in poverty, inclined inflation, large number of unemployed people and also there is socio political instability. As per unbalanced growth of country, it has been outlined that in 2008 there was difference of 9.8 fold between the poorest state that is Bihar and richest state that is Goa. Further, in India there are no political barriers to migration which promotes free trade just by complying to set of federal policies, governance and institution.
The service sector of India is largest in entire country with low level of development. The size of service sector is comparable to service sector of developed economies. Moreover, the decline in agriculture has been managed by the growth of service sector where manufacturing sector of India reflects no growth and is on same graph since 25 years. In addition, the remarkable growth of service sector has contributed to tax revenues. Regardless of decline in agriculture industry, the sector still employs half of the Indian population which is approximately 600 million. On the basis of fluctuation, it can be said that first and major challenge for Indian economy is to overcome inflation by managing productivity of different sectors. Like, low productivity and high wages in agriculture sector is the reason behind inflationary changes. In addition, the country is facing fiscal deficit where expenses have increases regardless of revenues and accumulation of debt year by year can lead to major decline in economic growth.
Apart from this Ghate, 2013, outlined about corruption which is also a reason behind low economic growth. For example, 10 % PDS money that is public distribution system reached to target people and remaining amount got leaked which influenced effectiveness of tax revenues, anti-poverty, etc. However, recent developments in India economy is reflected from some figures that is, manufacturing and agricultural activity of country has increased by 53.3 % that is 77.6 billion US$ and exports have increased by 221.83 billion US$ that is almost 20.7 %. Likewise, merger and acquisition for economy has stretched to 74.8 billion US$ and collection of income tax is approximately 137.75 billion US$.
On the other hand, the empowerment of Indian economy is reflected in its increased foreign direct investment which reached to 389.60 billion US $. Moreover, there is increase in employment rate and there were 10.8 million new jobs which were created to generate income and mange inflation. In addition, top 100 companies of India have states contributing to corporate social responsibility to improve working condition and economic contribution (About Indian Economy Growth Rate & Statistics, 2018). The central system of Indian economy is focused on doubling income of farmers and almost 196.94 US $ is contributed to improve standard of living and create better living environment for people in rural areas. In accordance with recent development, it has been determined that India will be on Top 5 list of the largest consumer economy because of changing expenditure pattern and consumer behaviour.
United Kingdom Economy
The country is market oriented and has highly developed economy of world. As per measurement of nominal domestic product it is 5th amongst the largest national economy of globe. Economy of UK struggled in start of 2018 because of heavy snow but right after improvement in whether the economic growth improved at very fast pace. The recession of 1920 collapsed the economy of UK but still the country managed downturn with positive changes till the second quarter of 2013 (The Economy of the UK: An Overview, 2018). The country is able to borrow money to clear the record of labour cost whereas gilt of yields was low regardless decision of Bank of England which was hike in interest rate by November 2017.
Unemployment rate of UK is the biggest success for the country which was initiated by start-ups and part timers. The youth population of country is focused on doing something new and innovative which acted as biggest job ad wealth creating opportunity or the economy. Un employment rate in country is 4 % whereas employment rate is 75.5 %. I accordance with this, it can be stated that regular 3 months’ earnings growth to August is 3.1 % which denotes the recovery of economy from financial crisis.
Apart from this, there is exceptionally low inflation which is largely driven by prices of super markets, oils and imports whereas interest rates have been increased by 0.5 %. On the basis of sales volume, mortgage approvals and consumer confidence, it has been determined that consumer spending is the driver of growth of UK economy. Retail sales of September were changed by 3 % while approved mortgage in August were 66.44 K. In addition, service sector of UK is known as power house of economy as it is accountable of 80 percent of total GDP.
Apparently, manufacturing industry of Britain has declined over past few years which has also led to led in employment. On the other hand, technological advancement is of great advantage and has boosted the productivity of sector which increased its economic contribution as well as flow of high quality of goods. Till August 2018, recorded output of industrial production was at 1.3 %. Construction sector contributes 6 % to UK economy but was greatly impacted by recession (The UK economy at a glance, 2016). Lending’s by bank for business s purpose has been increased since 2016 due to government pressure which was created to improve access to fiancé specially for business purpose. On the basis of UK balance of payments, it is evaluated that current account deficit deteriorated sharply in 2016, because of a fall in receipts from investments overseas and increases in outflows from the UK to foreign financiers (Fethi and Katircioglu, 2015).
The growth of UK economy is modest whereas per the condition it can be said consumer spending plays vital role in managing growth of UK economy. The wealth distribution in economy of UK is equal which promotes growth of society as a whole. The business organisation have started incorporating technologies in organisation in order to reduce manual handling and to improving effectiveness of business operations. Further, there is manageable increase economy in comparison to its pre downturn peak which was at 9.7 % which denotes annual change of 2.3 %.
It is outlined that the financial crisis led to huge fluctuation due to which there was low growth of economy but its was anagen by low prices, business contribution and financial investment of business. For example, selling bonds via Debt Management Office is the way by which UK government borrows money to fund gap between spendings and money it receives. IN accordance with discussion, it can be outlined that growth of UK economy is moderate and increasing because the citizens are supportive to economic contribution and are focused on coordinating their spending power as per fluctuating situation of country. Like the crisis led to unemployment and major fluctuation in process of daily good but the support of domestic individuals like business, youth start-ups, etc. helps in managing successful growth of UK.
Various dimensions of culture with reference to India and United Kingdom
Comparison of similarity and differences of two countries is done on the basis of 6 basic dimensions that is power distance, individualism, masculinity, long term orientation, indulgence and uncertainty avoidance. Hofstede cultural theory play a crucial role in determining differences in environment of two countries. It is especially based on business environment of countries which is regulated by individual cultural beliefs, values and norms. Hofstede cultural dimension theory is based on different types of dimension which helps in analysing and understanding different among people of two different countries that is power distance, collectivism, individualism, masculinity, femininity, uncertainty avoidance and orientation that is long termed and short term. It is important to focus on these factors to derives difference in thinking and working ability of people with different cultures.
Individualism v\s Collectivism
Individualism is termed as political philosophy of nation which reflects its social outlook, ideology, moral worth and stance. This helps in determining degree of interdependence a society maintains among its adherents. It is an analysed by self-image that is I or We which represents individualist concept where the people of country are focused on welfare of themselves and their family. However, collectivism concept is related to cultural value which represents society as whole where group is on priority rather than individual. In this people belongs to one specific group which denotes their beliefs values, norms, cultural practices and religion.
On the basis of graphical presentation of Indian cultural compass, intermediate score of individualist is 48, from where it is clear that society owns both traits that is collectivism as well as Individualism. It can be said that the individual concept of Indian society is result of its dominant religion perspectives which are based on Hinduism (Malhotra, 2014). The religion believes that life revolves around death and rebirth where re birth is completely depends of one’s own action entire life. On the other hand, collectivist society in India is limited to employee employer relationship, neighbours and social networks. These are particular growth which form collective society as their decisions are somehow related to each other. The compass denotes dominant score of individualism from where it can be said that people are focused on improving own lives but, still are attached have concern for own relatives and families which leads to diversion in compass score. The society is supportive but in good circumstance or when the output of situation is positive. The individual are influence with rebirth concept where society feels that involving in wrong deed of some person can hamper their rebirth.
As per cultural compass of UK, it is indicated that intermediate score is 89 which clearly reflects shift of dimension towards individualist from where it is analysed that people of Britain are highly private people. The society is focused on own benefits and own practices and no one even tries to enter into each other’s space. From the growth stage of development children are taught to think about oneself by deriving unique way of living and contributing to society. The individuals are focused on fulfilling own happiness and personal fulfilments. Thu, it can be said that society is focused on promoting and empowering ME culture. The diversion of cultural compass clearly denotes behaviours of people of UK where the individual are bothered about on self and are least bothered abut changes and their surrounding, Every person in society aim at improving one self by one or the other way. The focus of people is on owing and celebrating on success.
In accordance with discussion, it can be said that there is similarity between host country and host country in individualism concept but the countries think in two different ways which represents their cultural norms, values and religious beliefs.Like for example according to Indian people thinking about one self is important because action of present lives is related to re birth. However, people of UK believes that own growth and personality are the crucial factor for living stable life. The diversion over collectivism is more of Indian economy because their cultural norms and values of people encourage them to maintain positive relationship with society (Hofstede, 2011). Moreover, the individuals are socially active and have different social groups which helps them in exploring characteristic of culture that is integration, learning and social. Hence, the discussion over dimension can be summarized by stating that both the countries encourages contribution to society which is beneficial of economic development and building personal and professional relationships.
Uncertainty avoidance v\s Risk taking in business
Uncertainty avoidance is a situation which is related to uncertain situation that is the circumstances which cannot be predicted. The consequences can be positive or negative and therefore it is related to risk taking of business which can be predicted. Further, the dimension also determines the ability of both countries to handle certain situation like, there are people to avoid taking action and there are some who action according to condition regardless of end results. Apparently, it can be said that this dimension is completely related to cultural learning and perspective of people.
On the basis of intermediate score of UK, which is 35 it is clear the people are no worried about future and what it can come up with. The individual lives up to present moments and enjoy life to fullest. The society do not hesitate to change plan s according to changing situation instead they plan changes on the spot according to uncertainty of condition. The instant decision making attitude of people make count avoidance to uncertainty. The Britishers do not make decision on the basis of rules and regulation but are focused on playing fair by keeping interests of all people in mind (Rao and Srinivasulu, 2013). The society is not bound with strict regulations because of positive attitude of people towards changing situations. The rules which are framed for people are mandatory to be followed and are also accepted by all citizens as all the framed on the basis of cultural value that is fair play.
The extent to which Indian society fears to deal with uncertain or unknown situation because of created beliefs and norms. On the basis of cultural compass home country scored 40 which denotes that the society fear to neglect uncertain situation and therefore focuses on preplanning. Moreover, on the basis of score, it can be argued that India fluctuates between unusual condition from where it can be sated that the people has acceptance to imperfections where people tolerance for unexpected is high. People in Indian society do not take initiative and just settle into routine and roles without any argument. The individual focuses on working consistently and adjust in every possible situation (Gibbs and O’Neill, 2015). The score reflects risk taking dimension which is not positive as the person manages innovation with blind eye with regard to rules. As per Indian cultural beliefs nothing is impossible but the society understand the motive and need of adjusting.
Thus, differences between unavoidable dimension of two countries, it can be outlined that for people of UK end goals are clear for which they work on changes and uncertain situation while on the other hand Indian society aim at consistent working without making changes in regular routine function (Understanding the 6 Dimensions of UK Culture, 2018). Uncertainty avoidance dimension of people of UK is reflected in their light and actual process which the society adapts changes according to changing market environment. The adjustment of Britain people is based on innovation, creativity, attractive and consumerism approach (Taras, Kirkman and Steel, 2010). Thus, it can be said that there is huge difference in cultural perspective of India and UK over risk taking and uncertain situation of daily personal and professional life.
Gender Differences v\s Gender Equality
Masculinity dimension of cultural compass by Hofstede perspective of people with different cultures. High level of masculinity denotes competition, success and achievement of society. However, low feminine score denotes quality of life and caring of society. The score reflects level of motivation to do something new to explore culture characterizes that is integration, learning, social, etc.
As per UK masculinity score which is 66, it is determined that masculine society is more driven towards success but on the other hand society believes that performance and success of society is completely based on their performance and ambition. The graph is more drifted towards make society but there is no restriction for women who wants to follow their ambition. This core states about inequality on the basis of Gender which is very less in UK but still have strong place because if which innovative idea and talents is restricted (Country comparison. 2018). Gender differences and inequality is the common and increasing concern of society which is also derived from cultural beliefs and values of people. In accordance with UK, it can be stated the difference and inequality on the basis of gender is social, integrated and learned. For example, entertainment industry of UK, where inequality among male and female is common concern and is reflected by job role and opportunities given to learners.
On the basis Indian cultural compass score which is 56, it is clear that the society is very masculine in terms of success and achievements. It is the country where the cultural values of society aim at limiting feminine society to one basic living style which is one of the major reason behind declining growth of Indian economy in comparison to host country. Moreover, India is spiritual country where religious philosophies and values are priority for people. India is the country where possession of male society is very clear. The practice in country is common and was not also considered as difference or inequality because it is the place where work of male and female society is completely different from each other (Misra and Puri, 2011). The score of compass denotes control over possession but still reflect gender difference and inequality practices followed in country.
Thus, from discussion over both the countries, it is clear that there is no major difference in masculinity concept but it varies across different cultures and historical periods. India is one of the ancient country with one of the longest surviving cultures which gives it sufficient lessons in the significance of modesty and self-discipline. The society have been seen with drastic changes in cultural, religious and spiritual belief but still there are region where difference among gender is a common concern. On the other hand, UK is developed country which has experienced changes with regard to social belief of gender discrimination. Thus, society and cultural beliefs of both the countries that is UK and India have been driven by possession of masculinity but are now changing to empower feminine society and to enable equality learning and growth opportunities.
Tolerance to inequality v\s Lack of tolerance to inequality
Power distance is the dimension of cultural compass by Hofstede which is deals with tolerance to inequality. It is the concept which defines less powerful associates of community and firm within particular country accept or except that power is unequally distributed. Inequality among society another cause of cultural beliefs and values where people are treated exceptionally because of various cultural differences like, colour, cast, creed, religion, habits, etc. Equality in society is basic practice which need to compelled in order to manage diversity, Further, tolerance to inequality or power distance can be argued keeping international business as a base. Expansion of organisation across the globe is with the motive of managing equality and diversity to promote innovation.
On the basis of dimension score on cultural compass of India which is 77, it can be interpreted that society appreciate top down and hierarchical structure. Indian business attitude of people depends on boss of the firm, decision maker, power holder or privileged and unequal rights. The major reason behind lacking growth of Indian economy in comparison to developed countries is lack of involvement of lower level of employees in decision making. In equality at workplaces and professional relationship makes it difficult for the people to coordinate with management and lead to conflicts which impact productivity and performance of business. Further, to manage coordination with top management and lower level employee the Indian business organisation have centralised power system which enable’s effective communication but still do not deal with inequality.
The cultural compass score clearly depicts the inequality of Indian society from where it can be outline that inequality in India is not only on the basis of gender but is on the basis of wealth, status, cultural, beliefs, values and norms. There inadequate distribution of income Indian society is the major cause why the country is the slowest growing economy. Thus, it can be said that tolerance to inequality is the major reason behind lacking growth of country.
Britain is scored 35 on power distance dimension which clearly stated that society believes and wants to reduce of inequality that is people have low tolerance to inequality. The business organisation of UK promotes flat organisational structure where employees are given complete freedom to involve in decision making process of management. Moreover, the workers are given flexibility in working according to their condition which helps in encouraging equality and reducing inequality. Apparently, sense of fair play among people of Britain derives their tolerance to inequality which is very less (Understanding the 6 Dimensions of UK Culture, 2018). Enterprise in UK are focused on empowering employees by giving them opportunity to grow and grab own status. The freedom of society reflects their cultural practices which ensures equality and focuses on minimizing discrimination practices. People of UK are modest and low tolerance inequality. As per the beliefs of people, it is identified that the individual aim at providing opportunity to all regardless of their differences. This is major factors which helps society to grow and develop positive relationship with each other.
As per the discussion over tolerance to inequality, it is determined that cultural perspective of India and UK are completely different where there is huge disparity see in business environment of home country where host country aim at providing equal working status and involvement to people. As per dimension score of India, control, psychological security and bossy attitude of managers is formal and is encouraged. Top down and directive style interaction is ladder for workers for communication which is hard to cross. On the other hand, employee is UK are connected to top management and plays a key role in managing innovation in business and its services.
Short term orientation v\s Long term orientation
Goal orientation plays a crucial role in managing success of business and is reflected by individual cultural learning values and beliefs. In accordance with this dimension, society link s future and past aspects with challenges which individual has faced and which the person will be facing. In this the society plan changes and strategies according to uncertainty of situation. It is important for the people to vision their goals according to time. In this people encourage thrift and efforts in modern education system to predict future changes.
On the basis of dimension score of UK, the country is at 51 which denotes the goals determination process of society cannot be determined. The culture of people encourages them to analyse situation according to challenges which the individuals have faced and will be facing. In accordance with this, it can be said that understanding situation keeping in mind all the experience and situation is effective strategy for managing successful plan or business project (De Mooij and Hofstede, 2011). The culture of society avoids biased decision making and practices of favouritism which sets a core for orientation difference. The people in Britain promotes unified approach of managing situation which is generally short-term because according to cultural values of society it is important for the people to react instantly instead of preplanning.
However, dimension score of India is 51 from which it can be interpreted the culture of country is dominant. Further, the religious beliefs of Indian people are based on “KARMA” which is a philosophical thought according to which time is not linear. The people are stale to changes and according to their cultural beliefs changes are part of life which ca not controlled and neither changes. On the other hand, it can be argued that India culture is basically long term oriented and the decision of society are based on forthcomings. Indian society lacks punctuality and therefore changes in plan are done by people according to their comfort and changing situation. Thus, it can be stated that people manage changes according to uncertainty of situation and therefore never follow exact plan.
On the basis of discussion over host and home country, it can be summarized that time is not linear for both the society but India is not typically following western culture of managing goals and task and therefore way of approaching of Indian society swings both sides that is long and short term. The dimensional scores reflect neutral behaviour of people towards time orientation (Understanding the 6 Dimensions of UK Culture, 2018). The society is not blindly based on future changes but plan actions and strategies according to changing situation. Time evaluation of both the countries is neutral which denotes their focus on cultural beliefs and values. In addition, the society is hostile to changes and systematic to manage change for managing current problems or hindrances. Hence, it can be outlined that in both countries cultures appreciate modesty which helps in managing stability in changes of personal as well as professional life.
Differences in languages
Language is basic difference which defines distinct cultures. The foremost thing which is observed when doing internal business. It is important for business organisation to understand difference in language when promoting diverse work environment. It is the key concern which can boost and decline growth of business. It is related to interaction which reflects different types of feelings and thoughts. Geographic situations and social background of two countries are different and have more differences and less similarity. Influence of culture on language and communication of people embodies differences in culture.
India is known for combination of languages and literacy. More than 300 languages are spoken in country where Hindi is a nation language of country which is spoken by more than 40 % of people. The most common languages followed in India are Hindi, English, Bengali and Telugu. Nevertheless, the business organisation promotes communication in specially two languages that is Hindi and English. Using religious languages is not much allowed because it impacts ethical concerns of HRM practices when managing diverse staffing. On the other hand, it can be said that use of English in India is becoming which demonstrated drift of Indian culture to western practices. India is popularly known for its different language and has diverse cultures with different languages.
People of UK shares common linguistic base but the major difference which is occurs is among Brits and Americans. English is the common communication language which is spoken by 98 % of UK population. Apart from this, there are some religious languages used in UK that is Scottish, Welsh and Irish. The language which is used in business and every industry of UK is English but there are various industries where use of diverse language is encouraged according to field. For example, Entertainment and event industry where enterprise promote staffing of diverse people and immigrants in order to encourage use of distinct language to increase consumer base.
Thus, from the discussion over difference in language of host and home country, it is clear that English is the common language which is encouraged and used by societies of both the countries. Moreover, it can be said the English is basically used for business purpose and is the based on international business expansion. For instance, if in case enterprise of India planned to expand its boundaries across UK then it is essential for the firm to make use of proper language for communication.
Differences in religious beliefs
Religious belief is the aspect based on supernatural, spiritual and mythological aspect of one particular culture. It varies from country to country which present distinct identity of one particular economy. Religious practices are base of culture and the reason behind different behaviours of people. Further, it is a set of values, behaviours, and practice of people who follows same culture. There is various type of culture followed in one country which represents differentiation in religious beliefs of people in same country.