Abstract
Cultural factors have effects on business organization. There are various cultural factors which affect these organizations. These factors have various influences to the organizations depending on the country in which the organization is, located. Chinese organizations differ with the United States organization, because of difference in culture. This paper has discussed the organizations in both the United States and in China, thus highlighting the differences, and the causes of these differences in terms of culture.
Introduction
When we talk of cultural influence of organization in any country, we consider the country’s weather, area, environment, history, geographical location among others. The United States and China, are two different countries in different states, thus there is a difference in their business organizations, as a result of cultural influences.
The United States is the third largest country in the world, located North American between Mexico and Canada geographically it’s between 3800N and 9700 West. The United States have a long coastline of about 19,924 Kilometers. This has enabled a better business organizations in the country and especially being bordered by Canada and Mexico have been engaging in both domestic and foreign marketing of their goods and services. In China, there are traditions and customs which are not constant and they vary with towns, cities and provinces. China has many cities and provinces, and these were formed based on the various ethnic groups which exist in the country. The ethnicity has lowered the business organizations, unlike the United States, where their states have few groups and the majority having a similar primary ancestry.
This has made the United States to be better placed in business organizations compared to China.
When we generally talk of culture affecting business, the influence involves a lot. Some of the cultural factors may seem too small, but they contribute a lot to the business organization in terms of management, decisions and business performance. (Hofstede 2001). Despite how much an individual want to involve in business many factors related to culture tends to draw him or her back. To give examples and a better explanation of this, I am going to discuss the various factors necessary in business, and whose application is limited due to culture.
Main body
Communication which is a way of passing information from one person to another, either using gestures or verbally is one of the factors. A country’s culture can limit its application in business especially where a country’s culture does not allow various people to communicate, when interpreting peoples behavior, can limit one in business practice and performance. The culture can have limits on the capacity at which one can engage and operate a business on conditions that it cannot freely enable one to take risks in business, a factor which is necessary in business. (Gabrium & Holstein, 2001). The culture restricts people into its made condition rules, belief customs and reactions. The ethic, traveling habits as well as the level of Aggressiveness means a lot in business, and these are among the many factors that have to be considered in relation to culture and business operations to enhance better business organizations and practices.
The United State area is approximately 9,629,091 km2 and it’s bigger than China, thus giving a higher population to involve in business organizations compared to China. United States have a lower population compared to China, and it ranks the third populated country. The country has a lot in natural resources, and its in the country where we find phosphate, bauxite, gold, iron, nickel, silver, tungsten, mercury timber, petroleum and natural gases among others with these many natural resources, the country is usually involved with manufacturing and processing industries, thus raising the country’s economy.
The country has a terrain, that varies with the region and for this case, the west of the country is mountainous the East has low mountains, and in Alaska, there are characteristic rugged mountains, broad river valleys and generally a rugged topography. As a result of this terrain, the country has fertile land with 18% of the land being used for arable farming, 0.2% being occupied by permanent crops, and the other crops are grown on the remaining 81.8%. (Goetz & Encyclopedia Inc 1999).
Due to the availability of many natural resources and their processing to form their products, the country has been experiencing various natural hazards, and some of these natural hazards are related to the topography of the country. (Hofstede 2005). Among these natural hazards include, tsunamis earthquakes around the pacific basin, the mud slides which are experienced in California, forest fires along the west permafrost in the Northern parts of Alaska, and flooding among others. Due to these natural hazards there has been delay in development and business practices because most of the foreign investors and local investors are afraid of the possible effects of these hazards to their businesses or the business which they partner with.
United State has been experiencing environmental issues which have limited the country’s development, as a result of the unfavorable effects which they cause. Among these environmental issues include acid rains which occur due to air pollution, the carbon dioxide which is usually emitted from the fossil fuel burning, from processing industries. (House 2004). The agriculture which is practiced in the country involves the use of pesticides, which run off causing water pollution. Also the fertilizers which are used in farms causes water pollution. This water pollution limits natural fresh water resources. The practiced desertification also leads to limiting the fresh water sources. Fresh water being vital in day to day living of human beings, marine animals and livestock, a proper and better management is necessary to enhance the provision of the water.
United State has been on the front line to make Environment-international agreements, in order to minimize pollution to other countries as well as to protect the environment threats. Among these agreements are the Antarctic environment protocol, Antarctic marine living resources, ozone protection, and ship pollution among others. This has helped in protecting the environment and preventing cross-border pollution, a factor which has tried to ensure development though at a very small rate. (Daniels & Radebaught, 1995). With these measures, it has been an encouragement to investors with a hope of better environment which would facilitate the business practices, and organizations in the country.
The United State people had an influence in the business practices and organizations. The literacy in adults has been recorded 99%, a factor which has been enabling good communication in the country. Communication is a tool in business practices which promotes good relationship between seller and buyer, consumer and also suppliers. The United States has three main ethnic groups, with whites being the majority, followed by the blacks and then the Asians. The major population being whites the business organizations has been doing. The blacks also play a role in the American business organization, where they partner as employees.
The United States, birth rate is 14.2 births/1000 population and a death rate of 8.26 death/1000 population. This shows the higher birth rates compared to death rates. The country’s people life expectancy at birth total population is 78 years and this high expectancy enhances individual participation in the country development, and in business organizations.
The United States government is constitution based Federal republic, and being a constitution based, it means there are chances of involving individual people in the country in constitution creation, a factor that enhances airing of people’s grievances and honoring people’s rights. (Budhwar &Debra, 1999). This promotes country development, giving freedom to business practices as well as organizations. In United States, there is a large number of states (50) and a district which join together to form the United State, and this high number of states, enhances cross trade among the states. This leads to a uniform participation in the business practices thus giving better business organizations in the general United States. The United State is composed of a federal court and has three main democratic parties: Democratic Party, Green Party and Libertarian Party. These were formed after the attainment of independence in 1776 from Great Britain. (Whetten & Cameron, 1998, p.327).
China held a lead in civilization in the whole world, with its recognition in art and science, until later when there occurred famine, defeats by other militaries, civil crisis and occupation of their land by foreigners. They had the communists who tried to protect the country’s sovereignty. Up to day there has not been political freedom but in China, there has been a change in their living and this has all along enhanced the freedom for personal choices. China is located in Asia, and is smaller compared to United States. It is border to many countries with Hong Kong bordering it and the region. China has a climate that is not constant in all the parts but rather, subartic in north and tropical in south. The Terrain of chain differs from that of United States in that China is mountainous, with high plateaus, desert on the west, and its east has deltas and hills.
When it comes to the natural resources, China gives a lead over United States. This is because on the ranking China produces petroleum, vanadium, aluminum, hydropower potential, uranium, manganese, natural gases, and mercury among others. Despite the fact that these natural resources are also found in United States, the amount and quality in China is higher enabling China to lead world wide.
The land in China can also be divided considering the crops that are grown, with this I mean that China has a smaller arable land compared to United States and a higher portion of land being used for growing permanent crops. This permanent crop growing land is a little bit bigger compared to the portion dedicated for permanent crops in United States. This shows the reason why their economic status in terms of growing crops is not which very good, and this has been as a result of the climatic conditions which are not favorable for farming.
China has not been able to produce a lot or even to have a good position in business organization, due to the natural hazards which have been threats to the country. Among this natural hazard are the frequent typhoons which are experienced in the country’s Eastern and Southern coast. These typhoons frequent the coasts with an average of four per year being experienced. The country also experiences floods which usually cause damages to crops and houses, tsunamis, drought and earthquakes. This has been a factor that has discouraged many of investors to involve themselves in the country’s business because of the loses which are likely to be incurred as a result of these natural hazards.
When it comes to the environmental factors, China has been experienced acid rain, due to the air pollution as a result of sulfur dioxide and green houses gases among other gases produced from extraction and processing of coal. The country has poor waste disposal, and usually these wastes are never treated thus causing water pollution. As a result of subartic climate in the North, the North part of the China experiences water shortages, although this could be also as a result of the cutting down of trees and other vegetation. The cutting down of trees has lead to the erosion of soil due to lack of vegetation to cover the soil, which result of many of the places been at a risk of becoming desert. The people of China have gone to an extent of cutting down of endangered species of trees and selling them illegally, without caring about the problem which can come up due to cutting down of trees, or even minding about these species economic importance in their country.
China has participated in formation of international agreements concerning the environment to ensure that there is no pollution to other countries and to protect environmental threats caused by pollution. The ozone layer protection and biodiversity are some of the Environmental-international agreements made in China.
The history of China dates the country to have got independence 221 BC under Qin or Chin dynasty and to have promulgation in 1982. The China has a civil law system and the systems legislature has the power to give statutes.
The China country has a population of 1,321,851,888, as per 2007estimation ranking to have higher population compared to United States, with a population growth rate of 0.6%, a birth rate of 13.5% birth/100 population, and a death rate of 7 death/1000 population. This means that the Chinese have a higher birth rate and lower death rate compared to those of Untied States. However the Chinese have maintained a one birth per woman despite the fertility rate of two children born per woman. Chinese have a life expectancy of 73 years at birth, which is lower than the expectancy of United States. The average of children who die when still infants is 22%/1000 live births. This percentage is higher compared to that of United States.
China has a higher percentage of Han Chinese Ethnic group and the other groups being very few and scattered within China. (Hamilton, 2001, p. 27). The male in China are more literate compared to female Chinese, unlike in the United States where the level of literacy is standard for both male and female, provided they are above the age of fifteen years. According to my point of view, this literacy level has impact on the level of business organization in the two countries, with better business organization achieved with increased literacy level and the vice-versa. This indicates the reason why business organizations do well compared to the Chinese business organization.
In China, there has been existence of cultural differences which has limited Chinese from venturing in international business involvements, unlike in United States where business parties can freely involve themselves in the international business practices.
Comparing the United States government which is constitution-based federal republican government, and the communist type of government that rules the Chinese, the chance of having freedom to involve in business are higher in the constitution based republican government, since the individual rights can be considered when preparing a constitution, than the communist government where a lot has to be passed without consulting individuals.
China has been a country with various industries. Among these are the mining and are processing, manufacturing and processing of textiles and apparel, production of consumer products, such as electronics, processing of food, and manufacturing of transportation machines such as ships among others. This has made a growth in industrial production to a rate of 12.9%
On the other hand, China has been able to produce agricultural products such as pork, fish, potatoes and peanut among others. This shows that, if the climatic conditions were favorable then the country could produce more and be able to market them in domestic and global markets.
Economically, China has been moving all the way from small unplanned trade to an international trade in markets. This has facilitated the growth of the China private sector to a global involvement in trade. This was as a result of collective agriculture, and this enhanced state enterprises autonomy. (Meyer, 2000, p.181). There has also been stock markets and usage of banks to bank their incomes due to diversity of trade. This was all due to the trade expansion.
China ensured the sale of shares, and linked the Chinese currency with the US dollar, and sometimes the China currency could have a greater value compared to the United State’s ever since 1978, the Chinese currency has been of great impact in reconstruction of the countries economy creating increases in both GDP and purchasing power parity (PPP). This gave China a position in economy in 2007 where it was second to United States worldwide but in per cacita, the country was ranked to have low middle-income generating capacity.
The Chinese government had a lot to tackle, amongst which are provide jobs for many people who were not employed and were operating in enterprises owned by states as well as others being migrants. The government was also required to fight against crimes such as corruption among others. With this the country could be able to involve fully in generation of income for both the country as well as for the individuals in the country.
In China, there was economy’s transformation, and since it was very rapid, it resulted to social strife, and environmental damages. This needed government intervention to stop this and enhance total involvement in operations and practices which could generate money by all means and under all circumstances.
The coastal regions of China showed more economical development compared to the inner parts of China. This was created jobs for more people who worked as laborers and this also promoted the rural to urban migration to enhance the working of the laborers. China has been in the front line in environmental pollution. The pollution has been brought about by the soil pollution during farming, air pollution due to the industries that process coal and mining’s, as well as water especially in the northern part where the climatic condition are so down thus many people trying to get water by drilling. (Tan, 2004, p. 186). This pollution has made China to experience challenges in trade either locally, in domestic or global market. Many of the investors end up not investing in China, a factor that has been dragging China behind when it comes to trade and other business practices.
China is one of the countries which are getting old very fast. In China, this has been as a result of a policy of one child, a policy which inhibits the birth rate and total population thus enhancing very few people in trade sector.
The land which is used for arable farming in China has been under threat due to economic development. This has many people to shift from farming in rural areas and more to urban areas to search for jobs in industries and other businesses, leaving the land that is capable of producing arable farming to no people to utilize. On the other hand, the cutting down of trees and other vegetation has led to the arable farming in threat, since the land set for this cannot be used due to the erosion of soil in these places.
However, in 2007, the China government tried, to put, policies which could enhance the proper use of environment, and to stop disposing the wastes from the industries to facilitate the ceasing of pollution. To add on this, the government was involved in finding other possible sources of energy apart from coal and oil to minimize the pollution, while still maintaining the economic value of both the oil and coal. (Warner, 2003, p.25). To facilitate this, they planned on how they could buy nuclear reactors from west.
If this can be achieved, China can do well in trade and its economy can grow very fast since the environment pollution poses a great threat economy development.
The boundary of China and India has brought along a dispute. This together with security and foreign policy has had a great negative impact to China thus limiting China to involve in transnational trade.
China is also well known in trafficking of people for the purpose of sexual exploitation; this trafficking is both internal and external. The also use the victims of trafficking who can either be women, children or men in exploitive production of labor for their industries, or just to act as the source of income for the traffickers. Many people thus have not been involving Chinese in their trade because of the fear of falling victims of the people trafficking. This has contributed a lot to the poor Chinese business organizations compared to other countries.
China is also one of the countries which engage in illicit drugs, which is grown in some parts of Asia, and this has also drawn back the country’s business organization.
The Chinese look at business in a manner westerns will always use in looking at a business. Many of the companies owned by the Chinese will either lack good planning, or will be planned in a manner that they will not last long. With this I mean, it’s like the Chinese do not really think a business can require enough time for its planning which would subsequently mean the effective operation of the business in future, and good income generation as a result of the planning. The Chinese usually opt for what they can see today, forgetting to place something that will be a source for tomorrow prosperity. From my point of view, I think this is why most of the Chinese companies will be easily opened for operations and similarly closed down.
In China, they do not really value the need of good communication and good company administration. They have not time to research for their products market which acts as a draw back to their business organization. (Yeung, 2006.p.412). They relate their businesses and companies with good out look of their business to an extent that one can think from the look of a building in which a business is put on that the business has the best income in the country. This contrast with the managerial and the employees’ contribution in terms of know how and knowledge related to job.
Chinese like using a cheap labor, expecting much from the industries and companies in return. They expect high values of their low quality goods.(Alon,2003, P.xvi) They lack experience in research and marketing, thus the culture of the Chinese, and the environmental factors as well as the government need to at least put something into place to enhance the effective business organization in the country, something which is very necessary in the country’s economy.
According to World Bank doing business 2008, the United States has a better economy compared to China. This has been evidenced by the facts that in United States, its rare to have a business closed down compared to China, where business can be closed down even immediately after its opening; In China, a business can be closed without even operating for a duration which can enhance the business progress in terms of profits and loses. This can be as a result of poor business planning in China.
In the United States, it’s easier to start a business compared to China, and this is because of the knowledge which the Americans have on business and good planning and management compared to China.
The United States considers employing workers at a fair salary which facilitates better working compared to Chinese who consider the cheapness of labor minding less about the outcome of the labor.
Americans in United State consider having their property registered and their businesses licensed to facilitate good operations and efficiency without harassments from the government compared to Chinese who do not take this is a factor in their business practices. This ensures that the Americans pay their taxes.
Conclusion
In United States, there is ease in getting credit, compared to China, and there has been good relationship among the states, which promotes cross-border trade compared to China, where relationships across border are limited.
United States have a better ability to enforce tier contracts and at the same time providing protection to their investors, a factor that enhances better business organization and practices in United States as compared to China. (World Bank staff, 2007)
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