Why is an understanding of cultural differences important to the business managers at BreadTalk? To assist the managers at BreadTalk to decide if they should expand to Australia, briefly describe the Australian culture.
A wide range of definitions have been used for the term “culture.” Culture has been defined as the human-made part of the environment (Herkovits, 1955), including both objective and subjective elements (Triandis, 1972); as a set of reinforcements (Skinner, 1981); as the collective programming of the mind (Hofstede, 1991); as a shared meaning system (Shweder & LeVine, 1984); as patterned ways of thinking (Kluckhohn, 1954); and as unstated standard operating procedures or ways of doing things (Triandis, 1994). Although definitions of culture vary, many emphasize that culture is shared, learned, dynamic, and adaptive (Schiffman et al, 2011).
In today’s world of globalization, where migration, international businesses, foreign direct investments, expatriates’ work and any international cooperation has been rapidly increasing (Routamaa & Houtala, 2008). The understanding and appreciating cultural differences in businesses has become of vital importance to all organization in creating and sustaining a good relationship when managing a business deal. While David A. Ricks (2009, 7) mentioned “the failure to understand cultural differences can bear serious consequences,” understanding the importance of culture and respecting the role it plays in the lives of potential customers in foreign markets is vital and could the difference between success or failure of the business deal. Forget or trivialize this important ingredient, company’s business runs the risk of failing to attract potential customers, or at worst, alienating or offending millions of people and experiencing a huge loss of sales.
Being able to understand and practice unfamiliar culture when venturing into foreign market is vital to the financial success of the organisaion. It shows how culture should impact the company’s decisions, the interactions with customers, and the advertising strategies. Customers in different geographical regions generally have different economies, values, attitudes and preferences. Therefore, they differ in “what they buy, why they buy, how they buy, when they buy and, where they buy.” Organisations that fail to consider the culture of the target market may experience: • Consumer losing faith and confidence in the company’s product and company; • Negative public relations and the erosion of the brand that the company have worked hard to build; • Loss of revenue and sales opportunities;
• Possible punishment in the form of retaliatory legislation or lawsuits.
In entering and succeeding in a foreign market, it is essentially important that the company first understands the culture of the country. For instances, when BreadTalk venture into Australia market, the company have to study the aspects of these cultural differences in order to be successful.
When asked what is Australian culture? One answer to this question is that there is “a set of core values that both affect and reflect the character of Australian society” (Schiffman et al, 2011, 396). First, Australia has been identified as a diverse country (Australia Government, 2012), consisting a variety of subcultures (religious, ethnic, regional, racial and economic groups), each of which interprets and responds to society’s basic beliefs and values in its own specific way (see appendix 1). Second, Australia is a dynamic society that has undergone almost constant change in response to migrations, the economy and the technology (Productivity Commission, 2006). This element of rapid change makes it especially difficult to monitor changes in cultural values. Finally, the existence of contradictory values in Australia society is obvious (Schiffman et al, 2011). Example, Australians traditionally embraces freedom of choice and individualism, while simultaneously valuing the collective ideal of mateship. In the context, Australians like to have a wide choices of products (such as cars and electronics) from around the world, yet ‘buy Australian’, ‘Australian made’ and ‘Australian owned’ campaigns encourage people to consider merchandise that is produced locally by locally owned companies.