THE ROLE OF CULTURE IN INTERNATIONAL TRADE

BY BOZIDAR KEZUNOVIC, MASTER IN RUSSIAN AND SERBO-CROATIAN, HD IN INTERNATIONAL TRADE

 

Culture as a trade parameter plays a much bigger and important role in international trade than one might imagine.

That is an assertion.

To argue for such an assertion I will:

  1. look at what the concept of culture implies,
  2. split the concept of culture into it’s elemental or constituent parts and,
  3. prove the assertion by looking at the elemental parts and their role and importance in international trade and cooperation.

IMPORTANT!

The following terms are fully or partly borrowed from Danish Export Lexicon and Business Lexicon, of which I am a contributing author and editor in chief. In addition, I have added comments to most of the terms from relevant literature on the subject, articles in the press and especially my own observations and experiences. This from numerous business trips abroad and meetings with foreign business partners, both at home and abroad. The terms are therefore a good mix of “theory and practice”. That is, something that could be a pleasant surprise for Storm P. himself, who maintained: ”Luxury is one thing – practicality is another matter”.

In the following text a particular country will be named ”X-land”, ”Y-land” or ”Z-land” and a citizen of the respective country as an ”X-an”, ”Y-an” or ”Z-an”.

In connection with my talk or consultation the country or countries in question will be referred to by name.

Ad a) There is no unique definition of culture, though many attempts have been made.

Historically the word ”cultura” originated in ancient Rome. During the Renaissance the humanist intelligentsia adopted the term and continued to understand ”cultura” as literature and art – ARTIUM ET CULTURA LITTERARUM HUMANIORUM.

In the 19th century philosophers and scholars disputed as to what degree culture and civilization were synonymous. Kroeber and Kluckhohn, two leading Dutch anthropologists, in their research from 1952, identified no less than 164 different definitions of culture. They found that none of these definitions were adequate and themselves came up with definition no. 165.

Subsequently several researchers, including the leading American researcher and university professor Vern Terpstra, found Edward Burnett Tylor’s definition of culture both reasonable and adequate. It is quoted here in it’s entirety: Culture or civilization taken in it’s wide ethnographic sense is that complex whole which includes knowledge, belief, art, morals, law, custom and any other capabilities and habits acquired by man as a member of society”.

In connection with international marketing the concept of culture is important as regards; developing a business relationship with the locals, which products can be sold and in what form, and how communication can be tailored to have the intended effect. Lack of knowledge of cultural factors increases the risk of unknowingly acting in a way that doesn’t lead to the desired and expected result. At the same time there is a risk of doing long-term damage to marketing in the particular country.

Ad b) and c) Starting with the above definition, culture can be divided into its most important

elements or constituent parts (cultural factors). I have chosen to present 7 concepts as part proof of my assertion, whilst the remaining concepts relevant to the subject can be found by clicking on ”List of culture-related concepts”:

 

WORK ETHIC (work culture)

Man has no natural or innate urge to work. In antiquity, in Greek culture, work was degrading – something reserved for slaves, and not free men and philosophers, such as Socrates. ”The urge to work” or more correctly ”attitude to work” is often related in the media to the influence of a given religion over the centuries. In this context Christianity is championed for its positive attitude to work. With the rise of Christianity work came to be valued in a new way. In his letter to the first Christian congregations – the Thessalonians – Paul wrote: ”Finally, brethren, pray for us, that the word of the Lord may have free course, and be glorified…for even when we were with you, this we commanded you, that if any would not work, neither should he eat!”

Paulus’s message to the members of the Christian congregation – each and every one – was as follows: “We must all work for a living!”

Positive attitudes to work are especially known through the Benedictine doctrine uniting prayer with practical work,”ora et labora” (Lat.”pray and work”).

What is the work ethic of the Danes?

Many, especially older Danes, maintain that in today’s Denmark there is no longer the correct attitude to work. Usually they explain this with ”you don’t have to work to get food, it comes by itself”, whether you work or not. Without entering into a discussion of the truth or otherwise of this view, and what may lie behind it, I will merely draw attention to the fact that articles can often be found in Børsen, where one can read about diligent and industrious Danes. And moreover, Danes are described as being very independent and individualistic, as well as being conscious of the importance of their work both for themselves and the business they work for. In particular for Danes – despite their great independence and individualism – they are able to work in teams, that is, pull together.

Perhaps it is here we find the main explanation why Danes seem to get more done than, for example, Britons who have a longer working week.

What is the work ethic of another country?

For example, in ”Y-land”? Has the work ethic of the citizens of this country changed recently? That is, since the end of socialism and after the majority have returned to their Christian faith, which was prohibited and cursed under socialism.

A politician from ”X-land” has, in a discussion of the pros and cons of socialism, characterized

”Y-an’s” work ethic as follows: “They have no work ethic – they have been weaned off work under socialism.”

On the basis of my experience of cooperating with ”Y-ans”, I can say that ”Y-an’s” work ethic today is much greater than under socialism.

In ”Z-land”, of which I also have a thorough knowledge and which in many respects can be compared with ”Y-land”, the worth ethic is to the best of my knowledge by contrast, lower than under socialism,

An examination of the work ethic of a potential foreign business partner ought to be given much more importance in connection with the planning of outsourcing or the establishment of joint ventures, than is the case.

 

ETIQUETTE

With respect to trade the Danish word “etikette” can mean 1) an informational note on a product or packaging and 2) unwritten rules for civilized behaviour, especially in social and/or business life.

Briefly concerning the second meaning: Etiquette can be very different from country to country. Here is an example. On our way from the capital of ”X-land” to the provinces, our hosts made a stop at a scenic viewpoint. Once out of the car both the driver and the exports chief began to fart

and spit. Not just once or twice, but at least 5 to 10 times each. I don’t need to tell you what we Danes thought of this behaviour. Nonetheless, I will tell you that this behaviour in no way influenced, for good or bad, the results of our commercial negotiations. Most of all it was strange and amusing. However it was a different matter when the self-same hosts filled our plates at dinner. It was undoubtedly an act of hospitality on their part. They used their own knives and forks. Later in the evening I had stomach cramps and severe pains. On one of my numerous visits to the bathroom during the night I shouted in desperation: This trade agreement, dear BK, will be the death of you!

In such situations it is not unnatural NOT to think of business. You just want to get home as soon as possible.

It’s not quite so bad when your business partner smokes like a chimney during dinner or even less so when a foreign business partner endlessly tells dirty jokes. Nonetheless such examples of ”foreign etiquette” are in no way promoting cooperation.

Danish ”open-mindedness” in social settings can in some cases be seen as a barrier to cooperation with a potential partner from abroad, where there are other cultural norms and standards for what is allowed and what is out of order.

 

TRADE ETHICS

From the time of Arild the ethics of traders has been an object of criticism for the public because of their greed, especially towards the weak and gullible. It is no coincidence that the Roman god Mercury was the protector of messengers, traders and thieves. Traders in the Arab Islamic countries have by contrast high status, perhaps because the prophet Muhammed was himself a trader by profession. Trade ethics is a very important parameter of competition in international trade, as most countries keep a register of companies with good references, as well as a register of blacklisted companies. It can get much worse if a given company’s poor trade ethic becomes an object of discussion in the media.

 

TRADING CUSTOMS/STANDARDS/PRACTICE; USAGE

Informal norms for the behaviour of businessmen. Business practice varies from sector to sector and from environment to environment. Business practice can also include actual legal practice, in that they are part of the country’s legal framework as well as operating practice. That is the special practices in the procedures during the different stages of the transaction process and for

the design of the written correspondence, the conclusion of agreements etc. Information on business practice in export markets can be given by, among others, graduates in export studies.

One of the most talked about – in both the press and elsewhere – unwritten forms of business practice is corruption. We won’t comment on this type of business practice here.

 

CULTURAL DIFFERENCES

General differences in cultural features between the exporter’s and importer’s countries, that influence marketing. Cultural differences are part of the environmental gap when exporting to or importing from another country. Cultural differences can have a direct affect on, for example; negotiations, international marketing, export of projects, training and education, relocation and returning home as well as intercultural leadership. Cultural differences often become evident in correspondence and can be of crucial importance in creating mutual understanding and trust, without which trade and cooperation is impossible.

 

LANGUAGE/TRANSLATION

The necessity for expert assistance in languages when working on international trade transactions boils down to the simple fact, that the participants don’t speak the same language or don’t command it well enough at the required level. The most common form of expert language assistance is translation of brochures, correspondence, operating instructions, service manuals and other forms of technical documentation – and not forgetting – webpages. The concept “interpreting” covers oral translation of verbal communication between persons that don’t speak the same language, by help of a third party, whom has command of both languages.

The advantages of qualified assistance of translators/interpreters are, among others:

  • Settlement of trade transactions is possible;
  • The customer is normally more easily convinced in their mother tongue;
  • An interpreter can often be used as a bridge to a foreign culture.

The disadvantages of unqualified interpreting are:

  • Relatively large costs;
  • Dull, tiresome static communication;
  • Misunderstandings that very easily can lead to loss of orders.

 

TABOOS

Sensitive topics, that are subject to the unwritten law, that they are not mentioned in speech or writing. Taboos can differ according to the culture in question. Not being aware of taboos can have far-reaching consequences for marketing.

What should you do when meeting a potential trading partner from a foreign culture? If you don’t know otherwise, then I recommend ”Putin’s technique” or ”Putin’s road to success”.

In an interview Putin was asked if he could name the most important reason for his successful rise to become Russia’s president. He replied: ”Everything I shouldn’t say, I haven’t said.”

In other words, when meeting a potential trading partner from a foreign culture, ”don’t say anything that you don’t need to say”. In such situations silence is golden.

To be on the safe side, it’s advisable to consult someone who knows better.

On this – latest update of the webpage – we have chosen to focus on our unique core competence, namely consultancy and talks on THE ROLE OF CULTURE IN INTERNATIONAL TRADE

 

The text above gives foretaste of the lecture.

The fee for the talk on THE ROLE OF CULTURE IN INTERNATIONAL TRADE depends on the length of the talk, as well as where and when it takes place.

The complete list of CULTURE RELATED TERMS, including perhaps the most important of all ”TRUST” is fully described with practical examples of:

  • how TRUST is gained
  • how TRUST is maintained
  • how TRUST is lost.

can be bought (The Danish version about 25 pages) by contacting us on email: bk@arco.dk:

Modern research shows that it’s good for the brain to be challenged and stimulated intellectually – we can promise you that with our talk on ”The role of culture in international trade”.

More about the lecture by clicking the Danish version – so far only in Danish.