Abstract
As in any international business relation, factors such as political, economic, social, technological, and legal dimensions are expected to significantly impact trade activities. Social factors include the cultural aspects of exports and imports along with the differences among foreign markets. Culture poses to be complementary to FDI and exports. Cultural components include food, language, clothing, values, traditions, and beliefs, which differ from region to region across the world. When the countries are culturally different, investing and trading becomes a risk. Hence, in today's scenario, it is very important for the organizations to understand cultural differences in order to compete with their competitors. Understanding these cultural differences owes the opportunity to make or break the success of a foreign trade opportunity. The global businesses need to adhere to the demands and perceptions of different cultures in the countries when they purchase different products.
TopLiterature Review
Transnational flows of financial resources, people, culture, information, and goods across the nations have been witnessing significant rise over the years, thereby drastically transforming the world (Ritzer, 2001). Globalization is a multidimensional phenomenon which encompasses not only the economic components but also the political, ideological, and cultural, along with other similar facets (Prasad & Prasad, 2006). For years, globalization has been equated with the economic growth across the nations in the world. In addition to this, the process has also been addressed from the perspective of social sciences, international relations, politics, and economics. Hence, the term globalization comprises a system or a policy which promotes global interconnection and interdependence among the nations via advanced technologies. With the help of advancements in the information technologies, people in the Western regions are able to get familiar with the styles in the Eastern regions, and vice-versa.
The period of globalization, with its unparalleled intensification and acceleration of the flows of information, labor, and capital, across different regions is significantly impacting the culture across the globe. In any international business relation, the uncontrollable factors, such as economics, politics, legal, technological, and culture, are expected to impact the trade processes and relations within the nations. Globalization enables the individuals across the globe to understand the beliefs, ideas, and cultures. One of the advantages posed by globalization is the fact that the process brings the worldwide identity together. Any country owes the independence to share and represent culture in the businesses. With the proper understanding of the cultures of the different countries, any foreign trade opportunity can be made successful or unsuccessful.
Key Terms in this Chapter
Market: A regular gathering of people for the purchase and sale of provisions, as well as other commodities.
Economic: Related to the economy or economics.
Culture: The customs, ideas, and social behaviour of a particular society or an imdividual.
Business: A person's regular trade, occupation, or profession.
International Trade: International trade is defined as a set of actions which aims to exchange the goods, capital and services between the countries across their international borders.
Strategy: A plan of action designed to achieve a long-term aim.
Globalization: The process by which organizations or businesses develop international impact or start operating on an global scale.