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The Impact of Culture On International Commerce

I recall with fond memories my first business trip across the Atlantic to The Netherlands. With passport in hand I boarded a KLM 747 in preparation of the 7+ hour trip to Schipol Airport in Amsterdam. I visited Hawaii on vacation several times so a trip of this magnitude was well understood. However, I never had an opportunity to travel to Europe. What an opportunity! The full business agenda included searching for a new facility location in our fast growing European markets. These were the strategic/tactical objectives of the trip. The construction of an action plan with numerous revisions was located on my hard drive with a short cut for quick access. To plan for a “technical failure” a hard copy was included in my computer case. I was ready! Or was I?

We learn in business school the need to plan is one of the most important pieces of a project. Plan well and the execution will be delivered on time with less rework and within budget. Our professors’ share various models when deployed get results. Follow the road map to execution and your results will meet or beat the estimates! Our studies in business school focus on financial and operational algorithms. We study charts and graphs depicting various business conditions and how we as future business leaders may leverage these tools. We learn strategic maneuvers, theory, and case study in nature. We find how to apply corrective actions and get back on course. These are all required skills to deploy the plan into action. But one skill, country culture, is equally important. Are we adequately prepared to manage the “culture” that accompanies the business goal?

The Netherlands has an approximate population of around 17 million inhabitants and about the size of Maryland. The primary language is Dutch but thankfully English is heavily used to conduct business. The Dutch are a good hearted people who speak earnestly and frankly about business and life. This was not my first encounter with the Dutch. We had done business in Europe for some years. We subcontracted our manufacturing requirements with a Dutch firm but volume and market growth dictated we change the business model.

I was fortunate to already have formed a close relationship with a Dutch cohort. He would serve as my guide and if needed my cultural savior! It was amazing how much he knew about U.S. politics and current events. Even though I studied the Dutch culture prior to this visit I was humbled by the reality I was still naive! He was determined to not only assist in our business dealings but also share the inner workings of the Dutch culture. Textbooks could not provide this level of learning.

Let us fast forward, several years into the future. This time my travels took me across the Pacific to Japan and Korea. Having experienced international travel through different parts of Europe I thought it just might be a bit easier. Not completely true. Yes for starters, the flight was twice as long but that gave me ample time to study and review the new cultures I would encounter. This time my business objectives were customer driven. I would participate on a team to solidify new contracts in both Japan and Korea. As in The Netherlands I was blessed with a guide in both countries. The dramatic differences between our approaches to business in the U.S. versus Asia can best be learned through experience. The methodical pace of progress in decision making counters our “quick hit and out” mentality.

In conclusion it is the responsibility of the business student to delve into the inner workings of the impact culture has on the success of international trade. Strategies may be international in nature but how to deploy the plan also requires the human element. It is the responsibility of every business student to study and become proficient in various cultures. This is a prerequisite of successful international commerce. So let’s get started!

To my Dutch cohort and now close friend “Dank U Vel” for your dedication and patience.

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About the Author

Pete Papantos is an operations director at a Fortune 500 company. He is responsible for the global execution of their strategic plan and driving operational excellence using lean methods. In addition, Pete is a graduate instructor with emphasis in operations and strategic management — both in traditional and online settings.