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Although geographically very small, Singapore is well known for having one of the highest standards of living in the world and being a top destination for doing business.

A relatively young state having gained independence in 1965, Singapore has quickly become famously safe, orderly, green and clean, whilst boasting an enviable public transport system and an exemplary educational system. Prudent economic management, low taxes and first-class infrastructure all make it attractive for investment. As Felix Zulauf of Sulauf Asset Management has said it is probably the best-run country in the world.

Nevertheless, an understanding of the population’s different cultural traditions and background is required to truly maximise your success doing business in Singapore. Communicaid’s cross cultural training programme Doing business in Singapore will help you harness the following benefits of doing business in Singapore.

A Thriving Economy
According to the Singapore Economic Development Board Singapore is ranked as the world’s easiest place to do business, the most open economy for international trade and investment, the best business environment in Asia Pacific and third best worldwide. These conditions combine to make Singapore the most competitive Asian country and an ideal place to do business.

Smooth Efficiency
Known for integrity, quality, productivity and enforcement of the rule of law, Singapore is well trusted internationally. According to the IMD World Competitiveness Report 2008, Singapore is one of the top three least corrupt countries in the world. To back this up is the added bonus of infrastructure that seems to work flawlessly. The trains run on time, the roads are spotless and healthcare services are world class.

© istockphoto.com/francisblack

Multicultural Population
In today’s fast globalising world, we are increasingly coming to capitalise on the strength in diversity. Globally connected, Singapore is a country with a unique blend of cultures, lifestyles and religions. When doing business in Singapore, it is important to remember that its open immigration policy has created a cosmopolitan environment in which one in three people have come from abroad. Hence, the diverse population that consists predominantly of Chinese, Malay and Indian does not assume any single identity yet the different ethnic groups unite comfortably as Singaporeans.

Great Location
Singapore has fully profited from its strategically advantageous geographical position to become one of the world’s top transportation hubs with the busiest port in the world. Often referred to as one of Asia’s economic ‘tigers’, Singapore has its roots as a natural trading port linking East and West. A financial and commercial centre, Singapore is often viewed as accessible by Chinese and Indian businesses and as an English speaking gateway to the Asian market for Europeans and Americans.

With a thriving multicultural free-market economy, it is clear that international organisations can greatly profit from the above benefits of doing business in Singapore. Considering that English is the main business language and Singapore is considered the easiest place in Asia to do business, it is understandable that some fall into the trap of believing that doing business in Singapore should be plain sailing.

However, international organisations regularly doing business in Singapore or employing Singaporean counterparts should have a series of cross cultural training programmes on Doing Business in Singapore to ensure they understand the subtleties of Singapore’s business and social culture on all levels.

© Communicaid Group Ltd. 2010

Today’s world is characterised by global organisations with operations and employees across the world in constant contact via traditional and modern communication methods. The coming together of different nationalities offers organisations access to an unrivalled talent pool. However, it also creates new obstacles that internationally focused companies and institutions have to deal with in order to be successful.

© istockphoto.com/urbancow

Intercultural training can help employers and employees navigate the challenges of international working rooted in cultural differences by helping them develop their intercultural competence which is essential for global success.

International organisations working across the globe should provide intercultural training options for its employees to ensure they:

• Understand the implications of cultural difference on business
• Understand how they are perceived by their international counterparts
• Communicate effectively across cultures
• Build successful cross cultural relationships
• Help the organisation have a competitive edge in the international market

A high level of competence in the areas above, developed through intercultural training, will result in more successful financial cross cultural business endeavours, an improved corporate image and long-term relationships with international counterparts.

Understand the impact of cultural difference on business

Intercultural training programmes like Working Effectively across Cultures provides employees with a foundation for understanding the impact of culture on business. Through the analysis of several key dimensions of culture, employees are able to understand how their own cultural values compare to those of their international counterparts. Being aware of different attitudes to things such as time, hierarchy and risk raises awareness of potential differences and helps to develop strategies for successfully working across cultures.

Perception and Image

One of the most important things intercultural training develops is self-awareness. By understanding both their own culture and that of their international counterparts, employees are able to better identify differences which they will need to adapt to. Through an increased awareness of how they might be perceived in other cultures, both individually as representatives of the company, they will avoid any potential miscommunication and improve global business.

Effective Intercultural Communication

Another important area that intercultural training helps develop is intercultural communication. Different verbal and non-verbal communication styles can cause misunderstandings and frustrations that can potentially affect international business relationships and cause a decrease in productivity and efficiency due to the lack of knowledge or appreciation of cultural differences.

Problems in communication may arise from the obvious linguistic differences, but also from the often less apparent differences in cultural values which are often unconsciously embedded in people’s behaviour. The awareness gained from intercultural training about employees’ own cultural values and the impact they have on how they behave and are perceived is essential for anyone working in international organisations.

Build successful cross-cultural relationships

When working across cultures, it’s extremely important to consider the importance employees place on relationships. In some cultures, doing business means getting straight down to the tasks at hand while in others doing business is all about developing a solid relationship first. Stories abound about companies who were not able to build effective relationships with their international counterparts resulting in lost deals. Knowing how much time needs to be spent developing the relationship before starting negotiations or planning a project will ensure success. Intercultural training programmes can provide employees with the knowledge and skills necessary to build effective global relationships.

Increase competitive edge

Communicating and working across cultures often presents huge risks for international businesses. Communicaid’s intercultural training can help prevent wasted time, lost revenue and damaging misunderstandings which occur as a result of a lack of knowledge and understanding of the target culture. Understanding how people think and why they behave the way they do will help employees work more effectively, which in turn, will give the organisation a competitive edge over other organisations who lack this intercultural competence.

© istockphoto.com/Yuri-Arcurs

In an article about measuring the benefits of intercultural training John Schieman wrote, “Quantifying the business improvement from cross-cultural interventions is challenging, however it is clear that cross-cultural competence has the potential to make a significant contribution to top and bottom line results as well as individual performance.”

Intercultural training ensures international organisations maximise positive outcomes of intercultural interactions and reduce potential cultural faux-pas which could result in huge direct and indirect costs as well as lasting damage to the company’s performance and reputation abroad.

© Communicaid Group Ltd. 2010

Ever since details of Marco Polo’s adventures in Medieval China began to reach Western shores, China’s image grew in the imagination of early Europeans as a land of riches and opportunities awaiting whoever was courageous enough to make the long journey there.

Now, in the twentieth century, things are not too different. Since the communist regime in China opened the country’s borders to trade, Western companies have gone to great lengths to establish business ties there.

Results, however, have been mixed, and what was often idealised as a goldmine revealed itself to be a cultural minefield. While there are of course a number of cases where Western businesses have performed successfully in China,  there are others where organisations have encountered many challenges doing business in China, ranging from logistical to linguistic or cultural.

© istockphoto.com/Tigress

When China first opened its economy to international trade and business in the 1980s, much of the debate in the West centred on the most effective way of gaining a stronghold in what was a new and unknown market. The majority of international companies doing business in China opted for Joint Ventures (JVs) with Chinese counterparts which ended in mixed results.

The different experiences of Western companies doing business in China shows success and failure factors vary greatly, from purely technical reasons such as low quality and uncompetitive products, to serious cultural misunderstandings as to how to work with Chinese colleagues and potential Chinese partners.

Maytag’s case in particular is one example of Western-style management gone wrong. Once the third largest manufacturer of large home appliances in the US and a company that prided itself on the use of modern management methods, Maytag entered the Chinese market through a JV with the Rongshida Group.

This had developed from a small, collectively owned enterprise and had a corporate ethic of ‘harmonious business’, so when Maytag decided to launch a restructuring programme in the face of increasing competition by other Western companies, the relationship between the JV partners eventually collapsed leading Maytag to eventually withdraw from China.

However dynamic and increasingly modern, China remains a heavily traditional society where relations – whether in business or in everyday life – are heavily dependant on a system of ‘face’ and ‘guanxi’, a term which can be translated as “relationships” or “connection”. A principle that binds friends and associates in relationships promoting trust and cooperation, ‘guanxi’ commits a friend to do what he can for another friend when called upon and violating this implies a loss of face and reputation.

Despite the many challenges of doing business in China, many companies have discovered ways of not only dealing with Chinese cultural differences but harnessing them to create very successful business ventures and opportunities in China. One of the most effective is to pre-empt any issues related to business practices and customs by providing international staff and management with cross cultural training programmes such as Communicaid’s Doing Business in China.

Maytag Case Study Source: China & World Economy (67-79, Vol. 12, No. 5, 2004)

© Communicaid Group Ltd. 2010

© istockphoto.com/Nikada

The United States of America is founded on a fundamental belief in equality and national and regional identity. Today, the US population represents a multicultural mosaic of cultural and racial heritage. With its division into 50 independent and culturally diverse states, the US combines regional differences into one strong society united by tight national bonds.

America’s influence on business culture across the globe is undeniable, but understanding the local culture and habits is just as important when doing business in the US as in any other country. American culture is unique and may be challenging for any organisation doing business in the US that is unfamiliar with its variety. The following are some of the key challenges of doing business in the US.

Multiculturalism
Every organisation planning to establish their business in the US needs to be aware of the country’s cultural diversity. Immigrants from around the world brought their own values and beliefs to the US, creating a unique American culture. Today, according to the US Census there are more than 100 million people who belong to an ethnic group creating an even stronger multicultural influence. This phenomenon may be very difficult to understand for anyone coming from a homogenous culture. Multiculturalism is also visible in the office environment where people represent different values and beliefs.

Individualism
The concept of individualism is highly significant in American culture. Individual initiative and personal achievement are emphasised and valued. This sense of independence and self-reliance also extends to the workplace where business is frequently carried out autonomously. Consequently, an individual’s position in US society is determined by their own achievements rather than status or age. This may be a challenge for organisations doing business in the US who are accustomed to more hierarchical and collectivist behaviour.

Low Context Culture
The US has a low context culture, defined by the tendency to communicate explicitly. American society is task-centred and the primary purpose of communication is to exchange information, facts and opinions. In the US, conflict is dealt with directly and openly and Americans will not hesitate to say “no” or criticise others in public. This direct style of speech may be interpreted by foreign visitors as rude and may cause embarrassment to those who are unaccustomed to such explicit communication. However, it is important to remember that this bears no relation to personal feelings in an American business context.

Egalitarianism
An important element of American culture is the concept of equality. Despite the many differences within American society, there is a collective understanding of the notion of equality. Americans believe in having equal rights, equal social obligations and equal opportunities based on the concept of individual merit. Consequently, there is a general lack of deference in the US to people of greater wealth, age, higher social status or authority. This is evident in the way in which titles are seldom used in business environments and how Americans call each other by their first names almost immediately. People coming from more hierarchical backgrounds may find it difficult to get used to this lack of formality and visible division of power in the American business environment.

Understanding American multiculturalism, independence and individualism is key to doing business in the US effectively. Attending Communicaid’s Doing Business in the US cross cultural training programme will help individuals and organisations to maximise the benefits of their investments in this individualist and self-sufficient country.

© Communicaid Group Ltd. 2010

The Middle East is an enormous geographical and cultural region stretching from the Mediterranean coast of North Africa to the Afghani border with Pakistan. The region is home to many races and religions including Jews, Muslims, Christians, Druze and Baha’i.

A varied history of dominance and subservience has created a diversity of opinions, attitudes, traditions and cultural norms. Politically too, the Middle East boasts modern and free democracies and also endures theocratic autocracies.

For the past three decades the Middle East has been at the centre of global interaction, be it global conflict or global trade. Doing business in the Middle East can offer a number of key benefits, including the following.

© istockphoto.com/ Juanmonino

Rapidly Modernising Markets
Recent years have seen a trend towards the modernisation of markets across the Middle East in a bid to attract and keep foreign investment. The idea of economic diversification has also begun to spread as many of the oil producing nations become aware that revenue from oil will not last forever. Diversification has come in the form of tourism, telecommunications and I.T solutions which have all increased foreign investment potential for anyone doing business in the Middle East.

An Abundance of Natural Resources
As would be expected with a region spanning the area that is occupied by the Middle East, there is an abundance of natural resources, creating a profitable environment for industrial and economic growth. In fact, according to the BBC 62.5% of the petroleum produced globally comes out of the Middle East.

A Crossroads for International Trade
For millennia, the Middle East has been at the centre of global international trade. Whether the ancient ‘Silk Road’ or 21st century oil trade, the Middle East has always boasted first-class port facilities and today can also claim to have some of best trade facilities in the world.

An Educated Workforce
An educated workforce is a successful workforce. This is a concept that rings very true across the Middle East. Education is highly valued. In many of the countries in the region, the work force comprises people educated up to and beyond university level.

The Middle East is a vast, complex mix of cultures. Any organisation doing business in the Middle East should gain an understanding of the differences which exist. A Communicaid cross cultural training programme such as Doing Business in the Middle East will give your organisation an introduction to the complexities and challenges of doing business in the Middle East and strategies to maximise your chances of success.

© Communicaid Group Ltd. 2010

© istockphoto.com/ Izabela Habur

China’s booming economy, one of the largest in the world, is a magnet for foreign business investment. According to the China National Tourist Office (CNTO), China is a multi-racial country with over 56 ethnic groups. In the long course of its development, all the nationalities have joined in the effort to create the great culture that China represents.

The earth’s most populous and third largest country is often thought of as synonymous with ceremony, etiquette, ancient history and culture. International organisations will find a wealth of benefits to doing business in China however there are a few cultural challenges that must be taken into account to avoid misunderstandings, conflict and substantial direct and indirect costs to the organisation.

Cross-cultural training programmes for business and management such as Doing Business in China increase an organisation’s awareness and understanding of any potential cultural stumbling blocks to ensure that all involved create strategies for drawing benefits from these differences. The following are six of the key cultural concepts international organisations face when setting up or doing business in China.

Rules and Etiquette – Many aspects of Chinese society still strongly adhere to rules of etiquette. Elements of Chineses business etiquette code include rituals of gift giving and receiving (“songli”), accepted practices with regards to personal space and rules regarding dealing with older people or people in important positions. Various conventions also exist with regards to body language. For example, it is considered rude to point with just one finger and therefore Chinese people tend to indicate with an open hand.

Mianzi – When doing business in China, it is important to pay attention to the protection of “mianzi” or “face”. Face is entwined with personal pride and forms the basis of an individual’s social status and reputation. Damaging face through overt confrontation or criticism threatens the foundation of Chinese hierarchy and can be disastrous for business relationships in China.

Hierarchy – The strong influence of Confucianism is still evident in many Chinese attitudes and actions. The Confucian philosophy emphasises the importance of responsibility to one’s community, harmony and deference to authority. This is evident, for example, in China’s hierarchical system which tends to link respect, responsibility and authority to age, status and gender. When doing business in China, greet another person with a slight bow or a nod of the head and a firm handshake. Dress tends to be quite formal in the workplace, with men usually wearing a suit and tie and women in dress suits. When addressing other people, the last name should be used preceded by “Mr.,” “Mrs” or another relevant title.

© istockphoto.com/hfng

Communication Style – Differences in ways of communicating can often be a source of misunderstanding. As a result, international organisations doing business in China are sometimes left confused and struggle to achieve their business objectives if they don’t possess the required information. Chinese have a preference for indirect, high context communication. In other words, Chinese people often imply and infer rather than verbalise directly. Chinese also place a high importance on the impact of body language, relationships, emotion and other non-verbal communication. Conflict is best dealt with in private and indirectly. Equally, it would be wise to note that smiling is not necessarily a sign of happiness but can also result from worry or embarrassment.

Guanxi – meaning “relationships” or “connection” is a fundamental aspect of Chinese culture. Guanxi translates to a principle that binds friends and associates in relationships, promoting trust and cooperation, committing a friend to do what he can for another friend when called upon. To violate guanzi is to risk losing face and reputation (or that of another’s) and honouring it has been the main way of accomplishing every day tasks in China for centuries.

Communism– China is governed by a communist party which pervades into many aspects of life, including the economy and religion. The country is officially atheist. Topics such as politics and religion are best avoided in conversation when doing business in China until you have become well acquainted with your colleagues.

Recognising the cultural differences which exist when doing business in China is only the first step. International organisations must also understand the reasons behind these cultural challenges of doing business in China to develop strategies for maximum effectiveness. A Doing Business in China cross cultural training programme will help you turn challenges into benefits and maximise the potential of doing business in China. Moreover, it will contribute towards the development of an interculturally competent workforce, a huge advantage in today’s fiercely competitive global world.

© Communicaid Group Ltd. 2010

One of Geert Hofstede’s five cultural dimensions is power distance which looks at the degree of equality between people in a society.  According to Hofstede, the power distance index shows the extent to which people perceive inequality as normal in an organisation or institution.

In countries with a low power distance like Austria, Denmark or New Zealand, egalitarian attitudes are preferred and decisions are made cooperatively.  Conversely, in countries which have a high power distance such as Malaysia, Saudi Arabia or South Korea, a more formal and vertical hierarchy exists in most areas of society including business.  In Europe, power distance tends to be lower in Northern countries and higher in Southern and Eastern countries.

The table below shows some key differences between cultures with a high power distance and low power distance.

Cultural awareness training programmes such as Doing Business in Japan or Working Successfully Across Cultures look at the impact of power distance on business both in specific countries and on a global scale. A familiarity with this dimension will give you an improved understanding of decision-making processes as well as management styles around the world and how to adapt to them.

© Communicaid Group Ltd. 2010

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A huge country richly endowed with natural resources, Russia continues to develop both politically and economically. Russia’s cultural identity has been influenced by a mixture of ethnicities and a diverse history.

The largest country in the world, with the ninth largest population, Russia has recently established a consumer economy which is increasing business and investor confidence in Russia’s economic prospects.

While there are some clear benefits to doing business in Russia, an understanding of Russian business and social culture is essential to an international company’s success.

Punctuality – Russia is a polychronic culture, in other words, people tend to be flexible in the organisation of their priorities and attitudes towards punctuality are relaxed. Polychronic cultures also often feel it is more efficient to do several things at once; therefore meetings may not follow a linear agenda and may be interrupted by phone calls or people coming in. As a foreigner, you are expected to be on time to all business appointments, however social events are more relaxed and being up to 30 minutes late is acceptable. Patience is highly valued in the Russian society, try not to be mad when a colleague arrives late and do not expect an apology, they may simply be testing your patience.

Collectivism – Historically a country rooted in agricultural communes, Russia has maintained a collectivist spirit that pervades many sectors of society. The Russian affinity for the group can be seen in every day life, for example, Russians will often choose to join strangers in a restaurant, recreation is commonly arranged in groups and advice can sometimes be given to you by a complete stranger. This sense of co-operation and togetherness must be considered when doing business in Russia, especially when communicating. For example, it is important to remember to address the group rather than the individual.

Hierarchy – Hierarchy is an important aspect of Russian business culture with status being linked to age and position. It is important to be aware of the fact that usually meetings are held with people of equal status. Decision making is commonly done by the most senior employees in the company. Showing respect for seniority is essential for maintaining strong business relationships when doing business in Russia.

Personal relationships – Relationships start out quite formal within Russia but maintaining trust and a good working relationship from the beginning is invaluable for future business. When meeting someone for the first time, it is wise to address them by their patronymic name. This name is based on the name of the person’s father with the suffix “ovich” (son of) for men and either “ovna” or “evna” (daughter of) for women. The Russian language also has two forms of the word “you” distinguishing between the formal “vy” used to denote respect and the more casual “ty” used between friends.

Communication style – Russians tend to have a high context communication style. A high context preference translates to placing emphasis on relationships, emotions and body language and expecting the listener to read between the lines. Differing communication styles can often pose one of the most significant challenges for businesses working cross-culturally. When doing business in Russia remember that Russians are patient and will expect the same patience from you.

Negotiating – In negotiating, Russians often take their time and will not rush to make a decision. Russians tend to avoid compromise, which they see as a weakness and expect to either win or lose a negotiation. Therefore, expect negotiations to be tough and occasionally theatrical. Do not be surprised if you witness the occasional loss of temper, people leaving the room and threats to call off the deal, this is all part of the process of driving a hard bargain.

© istockphoto.com/dmbaker

Although recognising that cultural differences exist is an important first step when doing business in Russia, international organisations must also understand the reasons and implications of these differences in order to develop effective strategies for coping with these challenges.

A Doing Business in Russia cross cultural training programme will help organisations maximise the benefits and opportunities of doing business in Russia. Cross cultural training programmes also create a workforce with a high level of intercultural competence which is a huge asset to any organisation working in a competitive global environment.

© Communicaid Group Ltd. 2010

When different organisations merge into one, the success of the operation is not solely down to maximising market share, cost savings and efficiencies. Particularly in the case of international companies, the merging process brings together employees and staff from different cultures who may have very different expectations of how to work together.

The smooth integration of both companies is dependent on whether the organisations consider issues relating to national culture through cross cultural training programmes.

It is widely recognised that the management of organisational change and the smooth integration of corporate cultures is essential for any merger and acquisition. However, a fact many companies are not aware of is that approximately 60-80% of international mergers are unsuccessful because strategies to deal with and integrate cultural differences amongst employees were not in place.

© istockphoto.com/ Mike Bentley

By integrating two different cultures, the M&A’s success depends upon creating a ‘third culture’, shared and embraced by all employees. Language, cultural values, attitudes and behaviours are issues that inherently affect the integration process, and the parties involved in the M&A need to address them.

Cross cultural training for mergers and acquisitions can help provide the necessary cultural understanding and sensitivity, contributing to the success of the merger or acquisition.

© Communicaid Group Ltd. 2010

India is well endowed with mineral and agricultural resources and it has seen a significant increase in offshore outsourcing and manufacturing over the last couple of decades, which have helped India’s economy grow at a tremendous rate.

India’s Ministry of External Affairs reports that its higher disposable incomes, rising middle class, investment friendly policies and forward-thinking reforms all make India an extremely attractive place for foreign investors. There are several key benefits for doing business in India:

Engaged and career focused – On a social level, India is predominantly a collective society which places a huge emphasis on the group. However, in business culture individualism is becoming more common as employees are increasingly recognised, paid and promoted on an individual basis. Many Indians, especially those working in westernised offices or companies, are now turning their focus to their own career advancement and performance. Through training initiatives or certificate programmes Indians are constantly taking steps towards obtaining more knowledge and qualifications, which in turn helps international organisations doing business in India by providing a constant flow of highly engaged and career focused individuals.

© istockphoto.com/ wsfurlan

High levels of English – The historical relationship between the UK and India means that Indians have a high level of English. Although the accent and vocabulary of Indian English is slightly different from that of British or American English, international organisations will benefit immensely from graduates’ ability to speak English fluently, as well as their command of the many local Indian languages. It is in fact estimated that there are 14 major and over 1000 minor languages and dialects spoken in India. The relatively few language barriers make doing business in India quite attractive for international organisations.

Large amount of experienced specialists – India has an extensive pool of experienced people from which they can recruit employees. There is a high value placed on education in Indian culture. Combined with India’s drive to become a successfully modernised and competitive country, this is helping to produce a population of candidates with good qualifications and specialised experience and knowledge.

Openness to new ideas and opportunities – Indians have a relatively high tolerance for ambiguity and uncertainty and can therefore be quite open to new ideas and opportunities. This entrepreneurial and creative spirit is evident in the recent influx of new businesses in India. International organisations doing business with Indians in urban centres such as Mumbai, Bangalore and Hyderabad will particularly benefit as many younger Indians are taking on more western habits and working preferences. As they increasingly adapt to keep pace with the demands and expectations of new dynamic industries, international organisations doing business in India will face fewer cultural challenges when pushing new business ideas and endeavours.

Dedicated employees – Indians have a strong work ethic and take pride in their jobs. They tend to work long hours in the hopes of showing their dedication and increasing their status in the company. Most Indians will work eight hour shifts six days a week. When working for organisations which require communication on a regular basis with people in countries such as the US or the UK, employees will willingly work shifts around the clock to compensate for the time difference. This group of highly dedicated employees, willing to work long shifts over unusual hours, is a huge benefit for international organisations doing business in India.

© istockphoto.com/track5

All the above benefits are good reasons for global organisations to do business in India. Harnessing these benefits comes with the need to navigate the geographic, linguistic, religious and cultural diversity of Indian society. This requires a comprehensive understanding of Indian business and social culture on all levels.

International organisations employing people in India or working with Indians on a regular basis should therefore have a series of cross-cultural training programmes on Doing Business in India to ensure they develop the skills to successfully deal with the many cultural differences.

© Communicaid Group Ltd. 2010