A.S
Unit 39
International Business
Assignment 3
12/04/2021
How cultural differences affect international business
In the following assignment I will be describing how the environment and culture of another
country affects a business trading internationally. Comparing how cultural differences and
foreign businesses environments affect multinational corporations, and lastly evaluating the
impact of cultural differences on international business performance in the market.
Human resource practices in China
China has a very different working environment and different cultural operating
environments compared to the UK. Danny Armstrong, who was the managing partner of
Shine Wing Australia, a leading international Asia-Pacific accounting and advisory form, has
said “The intent of the function is not any different” says Armstrong. “Every business needs
to hire good people and put in place appropriate training programs, risk management
process etc. The intent doesn’t differ significantly. What does differ enormously in an
operating sense, and this is generalisation, is the cultural environment and the cultural
norms round how workplaces work”
The Chinese HR focuses more on the company itself rather than the employee, meaning
that the role is more strategic. It’s mainly about what’s best for the company. In China, a
business location, no matter if it’s in tier one, two or three. It makes a major difference in
how the HR works in comparison to other countries such as Australia and the UK. There’s a
point of view among those foreign to China that Chinese workers have very few or no rights
at all. However, Armstrong’s experience in financial services in China was the opposite.
Worker protection is very strong and highly protective of the employee.
Similar to Hong Kong, China has a very similar high replacement rate of employees. It is
commonly found that employees leave after 1-2 years of working for a business. Creating
the HR management that anticipates on people leaving the company, this is why it’s crucial
to keep the HR onboard. The only difference in Chinese HR is that in the execution, in China,
other working structures, rules and motivators are needed to manage HR well to ensure
productivity and quality execution in China.
Recruitment and selection
One of the biggest challenges for human resource managers is to understand the culture
and to set up the business practises and policies in accordance with it because without
being aware of the norms, traditions and values, no one can just make decisions which can
be good and give a good return on investments made. Most organisations in China prefer to
recruit though personal networks and social sites, these include WeChat, LinkedIn, Chitu,
51job, Zhaopin and Liepin. However, it may be challenging to recruit those who just came
into China or has no social networks yet. The businesses in China are classified as state-
owned, collectives, subsidiaries or joint ventures.
, A.S
Unit 39
International Business
Assignment 3
12/04/2021
Work Culture
Chinese work ethics are different compared to the rest of the world, as Chinese prioritise
hard work and diligence, it has become an integral part of China’s worldwide success. In
China it is accepted to take a 20-30 nap after lunch before going back to work, whereas, in
western companies, this would be frowned upon. Work culture in China also values
collectivism and establishing good relationships with the workplace, it’s normalised for co-
workers to spend time together after work, in order to build a stable work relationship.
Motivation & Reward system
In China, providing recognition to their employees is vital, as “Face” is an important social
concept in China. Chinese employees like to be admired and respected by their families and
friends, thus, recognising your staff will increase their standing in the eyes of the company.
Recognition also sends a clear message about the character traits and behaviour that the
company values. Many Chinese employees report that recognition for performing their job
well is one of their top motivations.
However, it is important not to overdo the value of the workforce with too much
recognition. If you recognise everyone at every activity they do, this will simply come to be
expected and appear normal. Instead, focus your recognition on the acknowledgment of
work well done instead of simply acknowledging someone on a routine schedule.
Marketing practices and preferences in China
China has the most internet users in the world today, with over 800 million reached in 2018,
triple the number of internet users in the US. China has therefore, became the largest e-
commerce market when it’s total online sales reached USD 409 billion in 2013. Chinese and
international companies both specialise in marketing in China. An organised marketing plan
is essential as it considers core elements such as the brand, stakeholder, management and
public relations.
The better way to deal with the complications of the Chinese market for marketing and
advertising purposes is to invest in and hire local knowledge. Both Chinese and international
companies specialise in marketing in China.
China is quite determined to get the best results, so they’ll sacrifice their leisure time just so
they could work/study. In China they’ll show their wealth and status by buying expensive
goods such as supercars, expensive watches like Rolex, Gucci bags, and more high end
products. Tesco in the UK is a great supermarket as they have a variety of products ranging
from expensive goods to goods that everyone can afford. Tesco will have to make sure they
do not mix these products together, instead they should think about how they’ll display the
goods at Tesco for example by positioning all the expensive goods in one section, and then
the cheaper goods beside it, so they can compare if what and find the best for them.
Unit 39
International Business
Assignment 3
12/04/2021
How cultural differences affect international business
In the following assignment I will be describing how the environment and culture of another
country affects a business trading internationally. Comparing how cultural differences and
foreign businesses environments affect multinational corporations, and lastly evaluating the
impact of cultural differences on international business performance in the market.
Human resource practices in China
China has a very different working environment and different cultural operating
environments compared to the UK. Danny Armstrong, who was the managing partner of
Shine Wing Australia, a leading international Asia-Pacific accounting and advisory form, has
said “The intent of the function is not any different” says Armstrong. “Every business needs
to hire good people and put in place appropriate training programs, risk management
process etc. The intent doesn’t differ significantly. What does differ enormously in an
operating sense, and this is generalisation, is the cultural environment and the cultural
norms round how workplaces work”
The Chinese HR focuses more on the company itself rather than the employee, meaning
that the role is more strategic. It’s mainly about what’s best for the company. In China, a
business location, no matter if it’s in tier one, two or three. It makes a major difference in
how the HR works in comparison to other countries such as Australia and the UK. There’s a
point of view among those foreign to China that Chinese workers have very few or no rights
at all. However, Armstrong’s experience in financial services in China was the opposite.
Worker protection is very strong and highly protective of the employee.
Similar to Hong Kong, China has a very similar high replacement rate of employees. It is
commonly found that employees leave after 1-2 years of working for a business. Creating
the HR management that anticipates on people leaving the company, this is why it’s crucial
to keep the HR onboard. The only difference in Chinese HR is that in the execution, in China,
other working structures, rules and motivators are needed to manage HR well to ensure
productivity and quality execution in China.
Recruitment and selection
One of the biggest challenges for human resource managers is to understand the culture
and to set up the business practises and policies in accordance with it because without
being aware of the norms, traditions and values, no one can just make decisions which can
be good and give a good return on investments made. Most organisations in China prefer to
recruit though personal networks and social sites, these include WeChat, LinkedIn, Chitu,
51job, Zhaopin and Liepin. However, it may be challenging to recruit those who just came
into China or has no social networks yet. The businesses in China are classified as state-
owned, collectives, subsidiaries or joint ventures.
, A.S
Unit 39
International Business
Assignment 3
12/04/2021
Work Culture
Chinese work ethics are different compared to the rest of the world, as Chinese prioritise
hard work and diligence, it has become an integral part of China’s worldwide success. In
China it is accepted to take a 20-30 nap after lunch before going back to work, whereas, in
western companies, this would be frowned upon. Work culture in China also values
collectivism and establishing good relationships with the workplace, it’s normalised for co-
workers to spend time together after work, in order to build a stable work relationship.
Motivation & Reward system
In China, providing recognition to their employees is vital, as “Face” is an important social
concept in China. Chinese employees like to be admired and respected by their families and
friends, thus, recognising your staff will increase their standing in the eyes of the company.
Recognition also sends a clear message about the character traits and behaviour that the
company values. Many Chinese employees report that recognition for performing their job
well is one of their top motivations.
However, it is important not to overdo the value of the workforce with too much
recognition. If you recognise everyone at every activity they do, this will simply come to be
expected and appear normal. Instead, focus your recognition on the acknowledgment of
work well done instead of simply acknowledging someone on a routine schedule.
Marketing practices and preferences in China
China has the most internet users in the world today, with over 800 million reached in 2018,
triple the number of internet users in the US. China has therefore, became the largest e-
commerce market when it’s total online sales reached USD 409 billion in 2013. Chinese and
international companies both specialise in marketing in China. An organised marketing plan
is essential as it considers core elements such as the brand, stakeholder, management and
public relations.
The better way to deal with the complications of the Chinese market for marketing and
advertising purposes is to invest in and hire local knowledge. Both Chinese and international
companies specialise in marketing in China.
China is quite determined to get the best results, so they’ll sacrifice their leisure time just so
they could work/study. In China they’ll show their wealth and status by buying expensive
goods such as supercars, expensive watches like Rolex, Gucci bags, and more high end
products. Tesco in the UK is a great supermarket as they have a variety of products ranging
from expensive goods to goods that everyone can afford. Tesco will have to make sure they
do not mix these products together, instead they should think about how they’ll display the
goods at Tesco for example by positioning all the expensive goods in one section, and then
the cheaper goods beside it, so they can compare if what and find the best for them.
