Over the past few decades, the business world has experienced various challenges as pertaining to cultural diversity competition, consumer loyalty, technology, scarcity of resources and the most recent one; globalization. As a result, most organizations have been forced to change the way they do business in order to survive these challenges.
Under such circumstances, the application of Knowledge management has proven to be the most effective tool to utilize especially in firms that have gone global (international corporations). In order to have a competitive advantage over the rival companies, it is therefore important for such firms to understand and manage all knowledge they have on the clientele, the technological requirements and the resources required to ensure success of their ventures (Styhre, 2003).
This paper shall focus on knowledge sharing as a key combatant to the cultural barriers that are often experienced by international firms looking to market their products in foreign countries.
A critical review of a relevant article shall be carried out to further support the fact that sharing knowledge pertaining to various cultural attributes may go a long way in handling the various challenges that are brought about due to cultural diversity. Using various principles of Knowledge Management as well as other literatures related to this topic, the paper shall in detail analyze the extent to which the article relates the topic under discussion (Knowledge Sharing) to the problems it wishes to address (culture).
The article “Culture as an Issue in Knowledge Sharing: A Means of Competitive Advantage” by Soley and Pandya (2003) sheds light on how cultural factors may impede the ability of UK corporations to operate in international markets.
According to the authors, the paper aims at evaluating: “Whether culture really does effect UK business operations in international markets, to examine and analyze the provisions businesses utilize to overcome the cultural problems of today’s international marketing, if they exist, to Identify the main cultural problems associated with UK business operations in international markets, to investigate whether technology can overcome cultural problems in international markets” (Soley and Pandya 2003 p. 205).
In addition to this, the authors further embrace the fact brought about by Martin and Simmon (2001) who states that “In international business dealings, ignorance of cultural differences is not just unfortunate, it is bad business” (67). The authors claim that many organizations have in the past undermined this statement and as a result, they have lost a lot of time and money due to cultural misunderstandings.
In this era where business dealings are bringing different cultures and nations together, it is important for organizations to have enough knowledge on how different people in different countries and markets perceive things. Failure to do so may consequently lead to detrimental effects on the enterprise.
Soley and Pandya (2003) assert that culture is a great phenomenon that is not easy to comprehend. However, good communication within an organization may help lessen the gap that exist between various cultures and create an environment where business dealings are made on mutual agreement.
Guffey and Almonte (2009), state that understanding how culture affects various aspects in an organization may help in averting future discrepancies. They assert that the culture adopted by a given country may determine the communication medium and technology to be used while making business deals. As such, having insight on the culture of the host country and knowing where to apply such knowledge may help in establishing tight business bonds with other nations irrespective of the differences.
As regarding to the methodology used in carrying out the research, the authors used interviews which were conducted among senior managers of different firms within the UK. The interviews were aimed at uncovering whether knowledge of the different cultures affected how the selected firms conducted their business, and whether technology helped alleviate the cultural barriers while dealing in the international market.
According to the findings, having such information is crucial to the business. Bradley (2005) asserts that communication is very important to organizations because it facilitates better understanding of the cultures which are adopted by their trading partners and customers.
He claims that through effective communication, business partners are able to identify, share and transfer knowledge pertaining to their cultures. According to Bernard (2008), knowledge sharing can only be effective if an organization adopts effective communication tools. He asserts that due to the fact that the world is becoming a global community; interactions with other people from other countries have become inevitable. As a result, the need to learn and understand other cultures has become a necessity.
According to Soley and Pandya (2003), “Managers at all levels generally need to be able to communicate successfully. Increasingly they must communicate in a new world of diverse colleagues, clients and customers of international operations,” (p. 207). From this statement, the authors are suggesting that communication and culture are slowly becoming synchronized.
They acclaim that communication mediums such as the internet have in the past decade enabled diverse individuals to communicate and come into agreements without having to meet on a physical level. Gattiker (2001) defines the internet as a diverse community. Through it, people are able to communicate with each other faster as compared to the traditional means of communication which were time consuming due to the variation in distance.
As such, the internet provides businesses with an avenue through which they can transfer information and share ideas which consequently leads to the establishment of international links. I also agree with the point the authors raise as regarding to the internet as a means to cultural degradation. Wood and Smith (2005) assert that the continuous usage of such technology may result to more cultural differences.
This is probably due to the fact that the internet is slowly developing its own culture which is being embraced by frequent users. According to December (2002), the internet technology uses a different language and the interpretations of this information vary from person to person. As such, it is always important that organization exercise caution when sharing information because misinterpretation of such may have catastrophic impacts on the organization.
The other issue addressed by the Authors is the impact of culture on the international market. They claim that having knowledge on the different cultures adopted by potential clients may help in reducing complexities and misunderstanding while transacting with people from different cultures.
In addition to this, they claim that understanding different cultures help explain the behaviors of the consumers and as such, this knowledge can be used to develop strategies which may be useful in regards to gaining a competitive advantage against rival organizations.
According to Mooij (2004), having knowledge on how culture may affect the international markets presents an organization with an opportunity to effectively put in place competitive strategies. On the same note, the author reports that such knowledge enables an organization to understand the market segmentation and how the international market is developing.
As a result, the organizations are able to make efficient decisions as to what to produce, where to supply and when. Understanding consumer behavior ensures that an organization produce according to the needs of the customers therefore assuring the organization steady market and a competitive edge against other companies (Hoyer and Macinnis, 2009).
However, Soley and Pandya (2003) claim that different scholars have raised different issues as regarding to the effects of culture on human behavior. According to the article, some analysts claim that human behavior is determined by culture while others acclaim that culture is nurtured from human behavior.
In my opinion, I believe that human behavior is as a result of environmental factors and personal experiences. Ajami et al (2006) reiterate that culture is as a result of the similarities that exist in the human behaviors within a particular setting. As such, having knowledge on how individuals behave within a given society may come in handy while making decisions on the international market.
Also, the authors of this article have clearly stated that the true definition of culture is inconclusive. This means that different people define it in different ways. As a result, they have utilized the definition which best describes what culture entails.
Through this definition, culture can be identified by five key attributes which are; “language, religion, technology, education and material culture,” (Soley and Pandya 2003, p. 208). They suggest that having knowledge of these attributes in regards to the host country may enable an organization make an investment or production decision.
In their discussion on technology and material culture, they state that the degree of conversance to technology varies from one country to another. Avgerou (2008) reports that most countries in Africa lack technical knowledge mainly due to the cost of getting wired, poor IT infrastructure and lack of technical know-how within the host nations.
As a result, having knowledge on which nations are fairing well in this sector may reduce the costs that would have otherwise been incurred in updating such amenities (Hill, 2008). In addition to this, this digital divide may lead to poor communication which in turn may cause losses to the parent company.
Servon (2002) reports that many international corporations have in the recent past failed due to lack of due consideration of the technological drift that exist between the parent country and the host nation.
This is attributed to the fact that technology in today’s society plays a pivotal role towards the success of any venture. As a result, investing in a country with poor IT infrastructure not only limits the potential of the firm, but also curtails the economies of scale which can only be realized through the utilization of cutting edge technology.
As regarding to language, Soley and Pandya (2003) acknowledge the fact that it is the greatest determinant to culture. The authors state that; “language is the most obvious difference between cultures. Inextricably linked with all other aspects of culture, language reflects the nature and value of culture,” (p.209).
From this statement, it is evident that having thorough knowledge of the language used in the host country is crucial to the success of any venture. The authors further acclaim that despite the fact that the internet uses English as the primary language or business partners may understand and/or speak the language it is wrong to assume that they are willing to use it during business dealings.
Consequently, it is always important that the organization gather enough information about the language preferences of the host country. Having the knowledge on how the host country deals with language will therefore assist in averting this cultural barrier. Allee (2001) reports that; “Without a language to describe our experience, we can’t communicate what we know.
Expanding organizational knowledge means that we must develop the languages we use to describe our work experience,” (p.2). This means that in order to combat language as a cultural barrier, organizations must ensure that they use a language that will comfortably suit them and that business partners in the host nation.
The other key attribute that should be considered while dealing in international markets is education. Moore (2010) defines education as the process of acquiring knowledge, skills and ideas through training. Soley and Pandya (2003) suggests that the education level of the host country is very important towards the success of any international business.
They claim that in countries where the education is low, there is a high likelihood that the communication and infrastructure is also low. As such, having knowledge on the educational potential of the host country may assist an organization device better ways of dealing with the clientele and the business partners.
In addition to this, statistics indicate that people with no education are very resistant to change. As such, lack of education in the host country may by itself hinder the success of an organization. Martin and Simmon (2001) reiterate that knowledge is power especially when it comes to international institutions.
They state that understanding the host nation gives an international corporation a bearing on what to expect and how to handle issues without provoking the locals. As such, understanding the education capabilities of the host nation can be used as a tool to avoid conflicts as well as to counter various challenges that may arise due to this barrier.
Religion is one of the other attributes that have been discussed within the article. According to Samovar, Porter and McDaniel (2009), religion varies from one person to another and it defines the culture that is adopted by these individuals. The authors assert that religion can be used to explain why people behave the way they do.
They claim that in as much as international business is primarily focused on how consumers and workers behave, it is equally important to gain some insight as to why they behave the way they do. Having such knowledge gives the organization an idea on what not to do or produce depending on the religion of the target market.
Soley and Pandya (2003) contend that religion can have a huge impact on how people perceive business and economic aspects. Renavikar (2003) reiterates that religious holidays, women social standing and their economic roles vary among countries. She claims that in some countries, women are not permitted to gain an education and neither can they be employed.
As a result, having such knowledge is imperative especially to organizations which are ethically bound to adhere to the affirmative action Act. Therefore, having thorough knowledge on the religious beliefs of the host nation will enable an organization to determine whether or not to invest in the country, what to produce and the ratio of employees to hire from the host nation.
Ethical theories are the criteria that we use to make judgment as to the fairness or unfairness of actions undertaken regarding problems (Sabath, 2002). The theories provide support to decision making and shed some light the thought process behind a conclusion. Some of the theories include the Consequentialism, Deontology and Virtue ethics. They can be applied interchangeably in various settings or can serve to complement each other.
According to Shafer-Launder (2007), the consequentialist ethics theory holds that actions can be judged as right and/or good only on the basis of the consequences they produce with no consideration for their intentions or motives. Utilitarianism is considered to be the most influential consequentialist theory.
This principle dictates that the collective welfare of the people overrides the individual’s right and as such, the theory advocates the maximization of happiness for the greatest number of people (Sabath, 2002). In this approach, the net benefit is calculated and the net consequences evaluated.
From these evaluations, a decision which adheres to the theory by having the most “productive” result is chosen. With this in mind, having knowledge on the ethical standards that the host country upholds is crucial to any organization.
Soley and Pandya (2003) state that bribery and corruption are viewed differently depending on the host country. As such, understanding how these issues are perceived in the host country may help an organization avert legal complications. For example in some countries, giving gifts to business partners is viewed as a form of bribery while in others it is not.
Through the hypothesis, the authors have been able to effectively bring out the objectives of the research study. All through the article, the authors brings into light the various attributes of culture and shows how they can impact international markets. In addition to this, they have managed to show how Knowledge Sharing and Management can be used to identify the various threats that could be brought about by cultural diversity (Nelson and Quick, 2000).
On the same note, by use of examples and theories, they have successfully highlighted the various dangers hat can befall an organization if it does not have a Knowledge management strategy. In their recommendation, the authors have clearly stated that the topic under discussion is too wide and that their research is not conclusive. As such, they have recommended that other scholars should do more research on the topic to further provide more understanding and information on the same.
This paper has summarized and reviewed the article, “Culture as an Issue in Knowledge Sharing: A Means of Competitive Advantage” by Soley and Pandya (2003). The authors have effectively brought out culture as an issue worth addressing in Knowledge Management. The various aspects discussed that may influence an investment decision are very useful especially to managers who wish to join and transact in the international market.
However, they have failed to provide conclusive solutions to the addressed issue. As such the question as o whether Knowledge management can effectively combat culture as a barrier to international business still remains unanswered. However, from the article, the importance of Knowledge Management and Sharing cannot be understated and to my opinion, the article provides a good foundation to business organizations which aim at venturing into the international markets.
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