Home Online Business Blog The Global Perspective in an Online MBA: Cross-Cultural Understanding and Global Business Practices

The Global Perspective in an Online MBA: Cross-Cultural Understanding and Global Business Practices

29 Apr
Diverse business team meeting in Dubai

Business is global, even for organizations that serve a local customer base. Almost all businesses depend on resources from other countries, whether from a dispersed workforce or raw materials for production. Today’s business leaders need a global perspective to be effective at helping their companies grow.1

This article will explore the importance of an online MBA’s international perspective in teaching students the skills they need to thrive in a global business culture.

The Business Importance of Cross-Cultural Understanding

Cross-cultural understanding includes language proficiency, but it doesn’t end there. It recognizes cultural differences in business practices and strategies, and adapts to diverse work and management styles.

A survey from Fierce, Inc., found that 86% of workers attribute workplace failures to ineffective communication and a lack of collaboration.2 Effective cross-cultural communication fosters agility and adaptability, allowing businesses to engage with people from a variety of cultural backgrounds. Organizations that promote cross-cultural understanding have better overall communication, strengthen bonds among coworkers and improve their performance.2

Missteps in cross-cultural communication, such as disrespect for hierarchical sensitivities or dietary requirements, can lead to significant business setbacks. However, by embracing education on cultural differences and implementing strategies for effective intercultural communication, organizations can avoid such pitfalls and foster a more inclusive, productive work environment.2

Leveraging Cultural Diversity for Strategic Advantage

A diverse workforce brings together people with disparate perspectives, backgrounds and experiences to foster an inclusive environment in which innovation and creative solutions thrive. This diversity generates new ideas and improves decision-making processes by including different viewpoints.3

Building inclusive work cultures that embrace diverse perspectives requires organizations to acknowledge and value the unique contributions of each individual. Strategies for promoting such environments include implementing inclusive hiring practices, promoting cultural competency through ongoing education and training, and creating channels for open and respectful communication.3

Diversity also promotes fairness and equality so opportunities within the organization are accessible to everyone, regardless of their race, gender, ethnicity or background. This approach aligns with moral imperatives and positions companies to better reflect and serve their diverse customer bases. By valuing diverse perspectives and integrating them into their core business practices, organizations can achieve a strategic advantage in the global market.3

Stepping Up to the Challenges of Global Business

Although there are challenges in doing business across borders, companies that successfully manage them stand to reap considerable rewards. Unfortunately, those that fail to make the effort to understand local cultures are setting themselves up for failure.

Global Business Challenges: Success

McDonald’s exemplified adaptability and turned cultural diversity into a strategic advantage by tailoring its menu to meet local tastes, such as offering vegetarian options in India. It successfully used local partnerships and maintained quality standards globally, which provided a consistent, yet locally relevant, customer experience worldwide.4

Coca-Cola is another brand that has mastered localized marketing strategies. The brand connects with consumers across different cultures through regionalized advertising campaigns and an extensive distribution network.4

Toyota’s leadership in the automotive industry is built on its reputation for quality and reliability, alongside its efficient production system. By strategically locating manufacturing and sales networks worldwide, Toyota emphasizes the importance of operational excellence and market presence.4

Global Business Challenges: Not So Much Success

Not every attempt at global expansion is a success. The following examples highlight the need for thorough market research and local sensitivity on the part of companies developing global business practices.

Walmart’s foray into Germany serves as a classic example of how cultural misinterpretations and legal missteps can derail international business ventures. After launching in Germany in 1997, Walmart aimed to replicate its U.S. success, known for its low prices, efficient logistics and tight stock management. However, Walmart’s American corporate culture clashed dramatically with German workplace norms. Practices that were intended to foster team spirit—group stretching, morning chants and constant smiling by employees—were perceived by Germans as bizarre or even cult-like, reminiscent of shameful historical periods.5

Starbucks’ venture in Israel is another example of misreading market dynamics. Despite the country’s affinity for American brands, Starbucks’ premium-priced coffee and "coffee to go" concept did not resonate with a culture that valued leisurely cafe visits. Furthermore, the taste of Starbucks’ coffee, deemed too mild for local palates that were accustomed to stronger brews, underscored the importance of adapting product offerings to local tastes.5

Airbnb’s exit from China after seven years highlights the challenges of localization and understanding cultural nuances. Despite efforts to adapt, including changing its name and interface, Airbnb struggled with Chinese consumers’ wariness toward homestays, differing service expectations and fierce local competition like Tujia, which tailored its services more closely to Chinese preferences.5

Tools and Techniques for Navigating International Markets

To thrive globally, businesses need to work out strategies that cater to the unique cultural, economic and legal landscapes of their target markets. In-depth market research can help them understand the nuances involved. This includes analyzing customers’ behaviors, their preferences and the competitive landscape. The insights gained from this research guide businesses in tailoring their value propositions to meet local needs.6

Localization involves adapting products, services and marketing content to resonate with the local culture and language. Effective localization includes translation as well as tailoring product features, packaging, pricing strategies and marketing messages to align with local preferences and cultural sensitivities.6

Companies must also adapt their marketing strategies to fit local cultures. Marketers can launch branding, advertising and promotional efforts that speak directly to the local audience. Using popular local social media platforms helps marketers reach and engage their intended demographics.6

Online MBA Education: Developing Global Leadership Skills

High-quality online MBA programs help students develop the global leadership skills that are needed in today’s business world. These programs dive deep into leadership theories and practices, including their applications in multicultural settings.

Students can explore various leadership models and learn to adapt them across diverse cultures and business environments. This theoretical foundation gives business leaders the skills to motivate teams worldwide and navigate the complexities of global markets.

Through interactive coursework, group projects and discussions, students engage with peers from various cultural backgrounds. This exposure simulates real-world business scenarios so students can practice and refine their teamwork and communication skills in an international context. By blending academic rigor with practical experience, effective online MBA programs equip future leaders with the skills they need to lead diverse teams, drive innovation and succeed on a global scale.

Prepare for Leadership Success in Multicultural Business

William & Mary’s Online MBA program will prepare you to lead in the global business environment. Renowned for its rigorous, comprehensive curriculum, William & Mary offers online MBA students a deep dive into many of the most in-demand business fields. In this AACSB-accredited program, the dedicated faculty of experts leads core courses and electives in organizational behavior, global managerial economics, leadership for the 21st century and much more.

Expand your leadership potential beyond national borders. Learn how the Raymond A. Mason School of Business can help you advance, succeed, and thrive in the global business landscape. Speak to an admissions outreach advisor today.