How do cultural differences affect business?
It's Clear there are cultural differences between us and our friends across the pond but how does this affect business?
Perception is shaped by our environment. A 100-year old house or church is considered new by Europeans, but old by Americans yet things are reversed when it comes to distances. Europeans would tend to think that driving 100 km is quite a long way, while for Americans that would be rather near. This is due to the much higher density of population in Europe, and the smaller size of Europe Yet, Europeans travel much more than North Americans, inside or outside their own continent. So, does our different perceptions lead to differences in doing business and how do we overcome them?
Confidence and positivity is often much higher in North America than in Europe! North Americans in general are more likely to view tough times ahead as a road to a better future. The British on the other hand are likely to be more cautious in their approach, Britons tend to be very modest and will often stay quiet during a meeting, speak less at networking events and be the last person to volunteer to do a presentation, however this shouldn’t be viewed as weak or less able.
Emotionally this sets both the UK and the North Americans apart, and this will have a clear impact on business, it will affect the way your marketing is viewed, understanding this emotional difference will allow you to ensure your assets resonance with a target audience, whether in the US or in the UK, you should strongly consider context, relevance, values and customer motivations.
Another example of this difference is the way that the different cultures define success. North America is famous for its love of capitalist enterprise, and this cultural tradition has affected the way that North Americans understand success. In the States, a successful business person is almost exclusively defined as someone who has a good salary and who has achieved financial success. In the U.K., position and being well-connected is more important. Understanding what motivates your target audience will support your success.
Small talk or networking as it’s known in Europe is another area where things can get a little “Lost in translation” even when the language spoken is the same! finding common ground can prove difficult if you don't do a little preparation in advance. In the U.K., people tend to be engaged in world news and other global concerns. British people also tend to be more reserved when it comes to discussing family and mutual acquaintances so networking can often be a harder challenge. Luckily these days social media have allowed us to do a little more digging before meeting people in person but while North Americans may be ok with people knowing all about them, The British are a little less keen and may feel uncomfortable if you tell them all about your love of their “quaint cottage”.
Advertising practices vary greatly between Europe and North America, while it is common to see people wearing inflatable costumes to promote products on American streets, it is very rare in most European countries. Likewise, Americans like to place giant billboards along highways/motorways, this practice is absent in most of Europe, where the only signs are public awareness campaigns for safer driving.
The U.K are also several years behind North America when it comes to ‘The customer experience’ in North America it is commonplace to thank people for their business but in the U.K this is often rare.
Holidays in the U.K., full time workers are entitled to 28 days off per year (part time workers are also allowed 28 days off, pro-rated). The average Americans have 16 days of paid leave but it is believed that due to fear of their work and professional relationships suffering most Americans only take around half of this off. There is currently a drive however North America for more flexible working and a work life balance and this may well see more Americans taking the full allotted time off in the near future.
U.K. employment laws tend to favour the employee over the employer to a greater degree than in North America. In practice, this means that British employers and employees must agree on contractual changes before they are finalised, and in the case of layoffs (Redundancies as they are known in the U.K), employers are required to carry out a consultation process. This is because most U.K employees are employed on contracts that give them rights to a fair dismissal and to notice periods. In North America employees are less likely to be on fixed contracts and are free to leave without notice, which also means employers can terminate working relationships without notice.
The U.K. is also further along when it comes to anti-discrimination laws but like North America do have some way to go to bridge the gender pay gap.
Corporation Tax In the U.K. businesses pay a rate of around 20% tax, and as low as 12.5% in Ireland (something that Medtronic’s took advantage of back in 2014) whereas in North America the rate is approximately 35-39%. This is great news for North Americans looking to open in the UK but something to consider the other way around.
These are just a few of the cultural differences between to very strong English-speaking nations (let’s not get started on the use of Z’s) A lack of cultural understanding can lead to tension and misunderstanding. That’s why, if you’re planning to open your business across the Atlantic it is advisable to do it with an agency that understands these nuances and can shape your sales and marketing efforts to accommodate them.