as defined by Shalom Schwartz (2013), refers to a community or group of
individuals who are united by shared
experiences that influence the way they
interpret and understand the world. Kashima (2013) further expounds on the
concept of culture by pointing out that culture
varies from a geographical setting to the next and that the idea of culture
plays a vital role in society. Culture
is an integral part of the lives of
people and shapes their values, principles, humor, thoughts, customs, beliefs,
and hopes among many others. Culture affects different aspects of life
including the way we conduct and operate businesses (Autio, Pathak, & Wennberg, 2013). Therefore, it is essential to understand culture and its diversity in various regions of interest.
of culture are critical in business especially when formulating business
strategies. The relationship between customs, traditions, beliefs, taboos, and
several other issues of people can be understood from a variety of perspectives. Culture
models people, it determines what goods and services to offer (Schwartz, 2013), it influences ethics in
business, it affects the attitudes of business, and time dimension of business
among several other aspects on business (Lozano & Escrich, 2017). It is,
therefore, crucial to understand cultural
diversity between geographical settings, for instance, countries and how the
difference in culture shapes business operations and activities.
and United States are two nations with distinct cultural values that also
implicates the way these two countryies go about their lives and how businesses
are operated and managed. The US is a country in North America with various
ethnic and religious groups, thus making the state
a mixture of cultures. India, on the other hand, is a country in Asia where
culture is determined mostly by Hinduism, the main religion in the region (Yugendhar, 2017). Both countries have a long history
of international trade with the practice experiencing unforeseen growth.
Cost of Doing Business
offers favorable conditions for doing business as reported by World Bank Group
(2013). Legally, starting and running a business is comfortable with just a few licenses and permits obtained from the
government. The current inflation rate is about 2.5%, a figure that economists
term as healthy for economic endeavors of a country, thus positively affecting
business operations. Apart from low
corporate rates, the government also promotes business through various
strategies such as offering subsidies, protecting ideas and intellectual
properties, and tax exceptions to small
environment presented in the forms of race and ethnic identity plays a significant role in starting and
operating a business in the US (Berry, 2015). A majority of the population is
composed of whites who own and control a large proportion of resources in the
economy. As such, unequal distribution of resources among the ethnic groups
makes it hard for minority groups to start and run a business successfully. The business
environment in the country is dominated by the Caucasians with the
people of color finding it challenging to
to Kumar and Sethi (2016), the unique political and commercial history and
outlook of India and the excellent economic
liberation since the 1990s have substantially influenced the cost of doing
business in the country to the extent that surprises even the world’s leading
economies. World Bank currently ranks India as the 77th favorable
country to do business across the world with an ease of doing the business score of 67.23 out of 100. Financial
costs of doing business related to legal
expenses, property and automobile insurance, product liability and worker
compensation are favorable. In comparison to the United States, Chaklader and
Gulati (2015) observe that medical insurance
and health benefits do not drain employers as much.
investment climate of the country is also attractive for various types of
business. Demographically, the state is
composed of 35% of individuals aged between 15 and 35 years – the working
population – the figure is expected to hit 70% by 2030. It is much easier to
access labor at cost-effective rates, easy access to financing, and favorable
infrastructure. In spite of the favorable conditions pointed out, setting a
business in India remains expensive. In most of the cities, there is a short supply of land and shortages of offices,
which are also costly. Compared to a majority of countries at its level, India
imposes more burdensome taxes and duties
with utility costs also ranking high.
to 80% of the population are Hindus with 14% being Muslims with the rest being
a mix of other religions. Therefore, India is selective on types of businesses
(goods and services) traded. For example, business ventures dealing in meat
products rarely succeed in the country as some of the beliefs prohibit certain
types of meat products. Klaus Klostermaier (2014) cites “Hinduism does not
require a vegetarian diet, but Hindus
mostly avoid eating meat products because
meat consumption equals hurting other forms of life.” Moreover, Muslims do
not consume pork and pork products.
Economic Development in The Country
growth hit the fastest pace in four years at 4.1% as reported by Apergis and
Polemis (2018). The gains are attributed
to a variety of factors including favorable policies by President Donald Trump,
strong consumer spending and a surge in exports owing to the trade tariffs.
Consumer spending increased by 4% from 0.5% from the previous years with exports
growing by about 9% – the fastest growth rate since 2013. Gross Domestic
Product (GDP) in 2015 was $18.12 trillion at a 2.9% growth rate. The figure has
since increased to $19.39 trillion in 2017 with a growth rate of 2.3%. Economists project the value will rise by 3.1% by the end of 2018 at almost $ 20 trillion in
economic outlook for the country can be
described as healthy considering the key economic indicators such as
GDP. It is an indicator that measures the production output of a nation. As
such, a rise in GDP growth rate is a good indicator of better economic
performance as Boons, Montalvo, Quist, and Wagner (2013) suggest. Although all
the sectors of the economy are expected to grow, the most likely economic
development in the country is manufacturing. This
is the fastest growing sector, and it is
also projected to grow faster than the general economy in 2018 and years to
come. This is mostly owed to the proposed policies on local production and
exportation by the current administration.
currently stands, 2018 is already a prosperous year as the country says goodbye
to the implications of the financial
crisis with the stock market also looking impressive. These are signals of a
peak business cycle, an aspect that is likely to attract both local and
international entrepreneurs and investors, thus seeing more business activities
in the country (Apergis & Polemis, 2018).
The political system is also steadily favoring business. For instance, the
proposed tax cuts by President Trump is highly believed to impact the economy
by creating more jobs, thereby attracting several established companies and foreign investors into the country.
fiscal year 2017, India hit an economic growth rate of 7.3% surpassing that of
China (a regional economic rival) which was at 6.9% and doubled the overall worlds
growth rate which was 3.4% beating most expectations. GDP hit an all-time high
of $2.597 trillion in 2017 up by 27.37% from 2014. GDP is expected to hit
$2.848 trillion for the fiscal year 2018 with spiky growth expected in coming
years (Subrimanian, 2018). The most significant
contributing sectors to the country’s GDP are as follows services (53.66%),
Industry (29.02%), and agriculture (17.32%). From this, the most likely
economic development in Indian is found
in the service industry.
sector employs 27% of the total workforce and also the fastest growing sector. According to Subrimanian (2018),
business process engineering and information technology are two of the fastest
growing areas within the service industry
with a cumulative growth rate of 33/6% since 2002, and also contributing 25% of
India’s exports. Business ventures, therefore, are likely to rise from these
two sectors of the economy considering their level of attractiveness to
entrepreneurs and investors.
economic performance of India is, however,
not that impressive when analyzed from a broader perspective by assessing other
economic indicators such as the inflation rate and exchange rates. Subrimanian
(2018) notes that inflation has been on the rise forcing the central bank to
increase the interest rates twice in three months as a responsive measure. Inflation is the sustainable increase in
prices of commodities and services. As such, it is not always a good look for
an economy. When the costs of products soar as in India’s case, it discourages
investments. Rupee, India’s currency also hit a new record low against the US dollar in 2018 resulting in
prices of imported goods and services shooting up.
is a key concern in the business environment mainly
due to its ability to influence people’s behaviors, innovation and customer
services as the main aspects of the modern
business environment. Culture is treated as a business issue with many scholars
in the field of business management believing that culture is a potential competitive advantage depending on how much
focus it is given by an organization (Eaton & Kilby, 2015). In this regard, culture affects business practices to a
significant extent. To understand the
implications of culture on business practices, it is essential to distinctively explore business practices in the US and
the US business environment is defined by individualism, efficiency,
competitiveness, informality, and openness to innovation and change. A business culture that also influences these practices is thus
efficiency-oriented and money-driven. As such, the culture is based on the belief that time is money and
hard work drives success. With this in mind, and also the self-centeredness of Americans, competition among
individuals and businesses is also very high (Van
den Berg, 2016). Openness and acceptance for change enable the country to innovate new products and
services increasingly. Due to cultural racial and ethnic diversity in the
country, there is no restriction on dress code, and
dressing to work depends on factors such as religion, company culture, and the position held, among others.
Culture also affects ethics and social responsibility of businesses in the US. As pointed out by Alison Landsberg (2018), racial diversity in the US has impacted the business environment with ethics being a key focus. To ensure equality on employment and other opportunities, the country has a set of ethical standards that discourage discriminatory behaviors against racial and religious minorities as well as other minority groups. Certain moral principles such as honesty, integrity, respect, fairness, and concern for another stem from Christianity as the dominant religion in the region.
India is a culturally rich country where one
can variedly experience an array of
religion, language, beliefs, and regionalism. Doing business in India requires an
in-depth understanding of all factors pertaining to culture before and when
formulating business plans and strategies. India is a multilingual country but
with Hindu dominating other languages (Cohn,
2017). Due to this, Hindu is recognized as the official language of the
country and used in various formal
settings including business environments. Unlike the US, India’s culture is defined by collectivism where people of the
community stress on the worth of people as opposed to the individual needs. Business
development is thus dependent on relationship building where Indians give
favorable deals to people they know and trust (Yugendhar,
2017). More so, Indians value time just
like Americans and are also strongly driven by results due to the belief that
hard work earns more success.
and culture, to a large extent, influence ethical behavior in business. One
area affected is the dress code in workplaces and other official settings (Landsberg,
2018). Although there are no restrictive measures on dress code, the
dominant style shaped by Hinduism. Traditional Indian attire (saris, choli
tops, Bravada, dupatta scarf – for women
and bandhgala, kurta, pajama, dhoti, and achkan – for men) are widely
recognized and accepted in the workplace
and other official settings (Chaklader, &
Gulati, 2015). Trust is also an important ethical principle derived from
Hinduism that every top executive and business personnel must observe.
model a person by shaping his or her opinions, beliefs, views,
perceptions, ideas, and understanding of the world making it a powerful
influencer (Platteau, 2015). The concept
of culture exists in every society and varies depending on geographical
settings. Understanding the concept of religion
and its element of diversity is ultimately important in the modern business
environment especially for business entities intending to diversify into new
and global markets. Culture affects various aspects of a business including its
people, communication, ethics, time management, and cooperation among many
others. The analysis demonstrates the extent to which culture in the US varies
from that of India and how these two sets of culture are impacting business
practices in the two regions. Between the two countries, economic performance,
and development are owed mainly to the cultural landscape in India than it is in the United States.
The United States, on the other hand, offers a conducive environment for doing
business than India. The US is
characterized by a supportive political
climate, economic environment, legal factors,
and social environment. However, the existence of several ethnic and religious groups in the US creates a
problem of disparities among the groups in accessing and exploiting
opportunities (Verbeke, 2013). This
aspect makes India a preferred
destination due to the togetherness of all Indians. As also covered, culture has
substantial implications on business practices between the two regions. This is
portrayed in the manner in which people communicate, partake opportunities,
relate to one another, dress, workplace etiquette, and interact. Autio, Pathak,
and Wennberg (2013) stress on the importance of understanding the concept of
cultural diversity from a global perspective and its application to the
business environment. This is mainly because business plans and strategies that
an organization formulates are influenced by the cultural values in the context the organization conducts its business.
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