Culture as a system of values serves to form people’s outlooks, attitudes, and stances. It plays a major role in all spheres of life but is especially relevant in business, as it may hinder or assist cooperation depending on how close the businessmen’s cultures are. The UK, being the center of world commerce and trade, attracts many businesses in the country that hope to establish durable business ties and engage in profitable enterprise with the local people. This paper looks at the cultural peculiarities of the UK and hypostatizes that the ignorance of cultural norms of the country leads to business paralysis and the inability to strike deals with local business circles.
One of the most well-known theories that study the impact of cultural peculiarities on the conduct of business is Geert Hofstede’s cultural dimensions theory. The Hofstede model reflects the influence of society’s culture on the individual values of its members, that is, how these values influence people’s behavior (Erdman, 2018). The author of the model emphasizes that the measurement of cultures can only be considered as a basis for assessing a particular culture in order to facilitate decision-making.
The Hofstede model singles out six key components instrumental for the successful conduct of business. First, power distancing is important as it allows businesses to either get preferential treatment or act totally independently (Erdman, 2018). The second factor that determines a successful business model in a particular country is isolation (individualism) as opposed to cohesion (collectivism) (Erdman, 2018). Thirdly, the author evaluates assertiveness, which is a focus on achieving results at any cost. The fourth dimension is avoidance uncertainty, that is to say, the degree of perception and reaction to an unfamiliar situation (Erdman, 2018). Finally, strategic thinking is assessed as a key element of short-term or long-term orientation for the future.
The strength of the model is in a successful combination of universal parameters that correspond to the analysis of the cultures of organizations, regardless of the country of location. Its weaknesses lie in the fact that it does not take into account the relationship between workers of the same culture, and in many countries, there are citizens who can be attributed to different socio-cultural groups. Secondly, the model is considered static, while cultures undergo constant changes.
Business ethics in the UK involves constant politeness, which may seem superfluous and hinder the establishment of business contacts. The British are often afraid to offend the interlocutor or find themselves in an awkward situation, preventing them from directly expressing their opinion and saying “no”, even if the contract’s fate depends on it. In terms of avoiding uncertainty, the British culture ranks low, as being overpolite prevents Britishers from expressing their opinion directly.
Moreover, English business culture assumes minimal personal contact despite external friendliness and cordiality. Quite often, small business owners do not keep staff for all occasions but use special corporate services (Cain, 2018). Individualism gets the upper hand over collectivism in Britain (Kumar & Kumari, 2022). Distancing from power structures is very high, which makes British businesses attractive for investments. Assertiveness and strategic thinking are among the key elements of the British business environment.
National peculiarities of business culture in England presuppose a special role of education. Depending on the type of business, education either has a decisive value or no value at all. Often, building long-term business partnerships, the Britishers consider which schools and universities their partners attended (McCarthy & Dragouni, 2021). Cambridge and Oxford look especially attractive to many successful entrepreneurs due to the environment and connections that their graduate has.
Cultural differences often stand in the way of doing business; many companies that want to merge cannot reconcile their values, which results in failures. Thus, in 1995, the British company Madge failed to acquire the Israeli company Lannet since there were irreconcilable differences in the culture of the companies. Both companies are suppliers of computer networks providers and Internet products. Since, at that time, Lannet was one of the leaders in Ethernet technologies and was known for its excellent performance, it seemed like a good deal.
The resulting difficulties came as a shock for both companies. The issues of “lateral independence, top managers contact, and decision-making” revealed a drastic difference in companies’ cultures (Weber at al, 2012, p.111). Thus, Madge management attached importance to cooperation and communication between different company units, while Lannet “used simple forms of coordination” (Weber at al, 2012, p.111). Controversially, Lannet’s management “believed in allowing and encouraging subordinates to be creative and try new things,” while Madge required strict subordination (Weber at al, 2012, p. 111). While Madge’s cooperation style placed emphasis on employee-to-employee communication, Linnet’s idea was top managers’ deep involvement in the company’s processes. Weber et al. (2021, p. 111) says that “Lannet management believed in decentralized decision making and delegating authority” while “Madge […] believed in strict control over decision making”. These differences led to a crisis; imposing its vision on Linnet, Madge drove away the most talented distributors and managers of the company, which led to a significant drop in sales and profits. Finally, recognizing its failure, Madge granted full autonomy to Linnet in its decision-making and even allowed the company to use its former name.
Thus, it can be concluded that cultural values lie at the core of every business and cannot be ignored. Moreover, in forming national identities, culture serves as a foundation on which successful businesses are built. Businesses should carefully consider cultural contexts before opening divisions in new countries or acquiring competitors working abroad. Without careful consideration and planning on the part of managers, cultural differences threaten to tear apart the soft fabric of any business that dares to enter a country without considering its culture.
References
Cain, P. J. (2018). Character, Ethics and Economics: British Debates on Empire, 1860–1914. Routledge.
Erdman, K. M. (2018). An analysis of Geert Hofstede’s culture’s consequences: Comparing values, behaviors, institutes and organizations across nations. Macat Library.
McCarthy, D., & Dragouni, M. (2021). Managerialism in UK business schools: capturing the interactions between academic job characteristics, behavior and the ‘metrics’ culture. Studies in Higher Education, 46(11), 2338-2354. Barner, C. (2012). Social media and communication. Sage.
Kumar, J. L., & Kumari, S. A. (2022). Cross-cultural differences in mergers and acquisitions. Journal of Legal Studies & Research, 8(1), 312-323.
Weber Y., Tarba S., and Bachar Z. R. (2012) The effects of culture clash on international mergers in the high-tech industry, World Review of Entrepreneurship, Management and Sust. Development, 8(1), 2012, pp. 103-118.