Cultural diversity – a tough issue for international business

I was reminded of research I’d done into some of the problems businesses can face when they expand overseas after reading In Paris, the customer is not always right. What’s considered good customer service in the London might be hopeless in Lisbon. I’ve jotted down a couple of examples of cross cultural cock-ups that have plagued international retailers.

The article about the French highlights one of their supposed cultural characteristics. Equality is a central principle in public life: that means you shouldn’t expect someone to ‘serve’ you as they would do in Manhattan or Manchester. The waiter, shop assistant or cab driver is your equal and you can’t expect to treat them as subordinate to you. Presumably that causes problems for French firms trying to operate in Britain or the US.

It must be hard to an international formula right: of the world’s top 250 retailers, 104 have no international operations at all, according to Deloitte, a consultancy.

According to The Economist, when Wal-Mart went into Germany in 1997, it assumed that Germans would like to be treated with the same courtesy as Americans but Wal-Mart discovered that many Germans regard shop-assistants who try to help them with suspicion and flee the premises to avoid buying anything from them. To be fair, they got off to a bad start in Germany by appointing a country manager who did not speak German. In Brazil they failed to notice that people like to shop as a family group: the aisles of its shops were too narrow to accommodate the standard family party.

B&Q, a British do-it-yourself retailer, discovered that Chinese people look down their noses at doing things themselves. It became a buy-it-yourself, and get somebody else to do it for you, retailer.

There must be countless other examples where culture – not the business environment – make international operations tricky.