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Fashion & Culture Assignment
Effects of Culture and Social Values On Economic Success and
Entrepreneurship
Type of Documents : Assignment No of Words : 2,000
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Effects of Culture and Social Values On Economic Success and Entrepreneurship
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Culture is one of the major factors which effect an organizations growth as well as
sustainability. Culture has deep effect on nature of business and entrepreneurship and
business organization. It is also important to study correlation between social values and
economics, and for this sake examples of countries like India and Indonesia are taken in this
essay.
Culture is a worldwide occurrence as there is no civilization in the past that does not
have any culture. Culture of a nation indicates the characteristics of that country like
religions, social habits, language, cuisine, art and music, etc. Culture can be measured by the
attitudes, beliefs, norms and values of the country. Every country has their own values and
beliefs which makes its culture different from other countries. Entrepreneurship can be
explained in the term of business ownership (Bergitte, 1991).
Entrepreneurship is not an innate ability which comes and develops as per
surroundings environment, which involves a complex mixture of social and economic factors.
Entrepreneurs are those people who setup own business and grow it up so that many other
peoples can be hired as workforce and targets can be achieved. An entrepreneur is always
from a society and has own view and beliefs which are directly effected by their culture.
Cultural values intensely affect the entrepreneurship in both the countries even after there is
vast difference in the culture of India and Indonesia, Business surroundings in Indonesia are
hard, information related to corporate finance is usually occupied and if obtainable then it’s
not so dependable. Other then this in India business surroundings is satisfactory and business
finance information is easily accessible (Chung, 2004).
Entrepreneurship can never survive in given circumstances; it can convert into a
successful business in a right environment. A business with western culture cannot survive in
India as there is vast cultural difference, so an entrepreneur has to change their business ways
to generate business into India, as the example can be discussed of KFC in India, KFC is
well-known for its chicken and non-vegetarian food but it has to change and add more
vegetation menu for India as most of the Indian population is Hindu and don’t eat non -
vegetarian food. Same like this many Indian businessman’s has developed their businesses on
world level and working in different parts of world but even in other countries the effect of
home culture comes into the business as the entrepreneur is having an typical Indian culture.
All these indicate that culture have extremely helping role for entrepreneurship. Influences of
family unit and belief deeply establish entrepreneurial culture, as some religions are originate
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to be favourable to free enterprise, while some other are hold back from entrepreneurship
(Freytag, 2010).
Religions mostly decide that from what business an individual should avoid. Specially
in India families and religions always gives their views about setting up a new business or
expanding an existing business and so the decisions of entrepreneur are effected with the
conversations by people. Family also plays an imperative role in determining entrepreneurial
characters. Relative’s backdrop, cleanly familiarity with a business setting, rising from table
chat at residence is the key to amplify the chances that a young individual will later turn into
an industrialist. An individual starts shaping his future with the table talk.
There are many things which motivate a individual to start business in it either can be
earning or can be service of society but in both the aspects the decision of starting the
business vary by the effect of many factors. An entrepreneur always tries to keep the working
environment familiar and work-friendly so that the entire workforce can perform well and
give their cent percent. The culture of an organization is depends on the culture from where
all the members of organization are related (Nayab,2011). Every member of the organization
has their own ethics and views but they also have some common thoughts which indicate that
they all are from a common society or having same culture. In many organizations cross
culture can be seen but they have more conflicts compare to the organizations where
members has common culture.
Every entrepreneur wants that their business always keep growing, it’s an common
mentality of all the entrepreneurs, many of them get much success in their country but can’t
achieve the objectives in other countries, all because of culture. It is not necessary that every
entrepreneur get success in all type of cultures as in home nation the entrepreneur knows the
values and ethics of people but it is hard to know them in a different culture. Different culture
has their different values and beliefs which make them different from each other people of
two different cultures can easily find because of their dressing, language and way of
presentation (Shane, 2003).
Most of the families in India and Indonesia are middle class and directly or indirectly
conceded from service sector. Very few of them desire to start own business as they
following the old concept of just earn for own. Many youngsters can not start own business
by family problems or financial problems. A person from middle class hardly thinks about
starting own business and recruiting employees as from a very small age he had understood
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that education is for get jobs in future. Some time youngsters come with innovative ideas and
confidence of being an entrepreneur but even in such cases the thinking of surrounding
peoples like family and friends change their mind set. In India most of the industries are setup
by past generations and handed over to their next generations and so on (Casson, 1982). In
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and achievement get the greater level of economic growth much faster than societies which
don’t appreciate these things. Societies are the groups of individuals who works for the
growth of economy, most of the members of society earn income thru various sources like
businesses or providing services. Peoples contributing in the economy are also is the part of
societies and have the views and ethics of society (Hofstede and Nooderhaven,2004).
Economic growth of a country is depends on the earnings and financial activates of
individuals of that country.
It is the culture and the social values that make all differences. Any organization can
achieve economic success by promoting good values and responsibilities towards the society.
In most of the countries like Western Europe, Japan and North America, organization are
identifying that integrating the needs and wants of the customers, suppliers, employees and
communities with the corporate strategies is the good business sense. With this approach in
intellect, company can earn huge profits and returns for them over a longer period of time. In
addition to this, it will also render a supportive hand in promoting the growth of the firm.
This concept is sometimes being known as the stakeholder concept. In this concept, the
management of the company is liable to seek an optimum balance between the diverse needs
of the various interest groups and electorates affected by its decisions or in other words, those
who have some stake in the business. The stakeholder model is based on the assumption that
each and every organization has some social responsibilities. By having this, company can
also achieve economic success (Boettke and Coyne 2007).
The path of success can only be achieved, if the organizations are effectively
conducting all its operations. This can be done majorly by first comprehending the culture of
the country, where it is operating its functions and afterwards developing an effective
workforce (Organization Code of Ethics, n.d). When speaking in volume about the Chinese
culture and social values, more prominence is being given to ‘Confucianism’. With a view to
uphold relationship and maintaining loyalty with thee patrons, this phenomenon is very vital.
With this phenomenon, the nation has achieved economic success and sustaining a dominant
position in the market (Chung Shen, 2004). From the above fact, it can be articulated that any
business concern who wish to conduct operations in this market is required to be strong in the
point of ‘Confucianism’. They have such values and culture, which makes them potential and
overriding in the market. However, other than Confucianism, there are many other factors,
which also need to consider (Lunenburg, 2007). The culture and social values of a particular
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nation might impact the behaviour of people within the business and thus, it becomes very
crucial and complicated task for the management to administer it. The social values of
Chinese people demands honesty, integrity and transparency. On the other hand, in India, all
these words have no meaning in place. Those companies, whose culture does not foster
honesty, integrity and transparency, will not be able to sustain effectively in the market of
China (Heaps, 2009). Therefore, it is clear that to achieve the economic success, social values
and culture is significant for the firms to understand. Without which no business can flourish
in the market. All the employees along with entrepreneur are directly or indirectly connected
to any culture and the effect of the culture come into the way they perform their operations.
By making the comparison of social values and culture of china with U.S.A, a far
difference can be noticed. In USA, most of the people would like to have every transaction
through contract or written agreement (Organizational culture, n.d). In the culture of USA,
bribery is considered as a social evil and is beyond the ethics activity. However, in some
countries it is not like that. The social values of French and Germany regard bribery as the
fabric of life and are not illegal. Hence, for those firms who are willing to operate in these
nations, are required to embody such ethical standards, social values and culture that are
being supported by those companies and their societies (Heaps, 2009). These entire nations
have achieved economic success by their social values and culture.
In the present scenario, trading and operating in the international market is the name
of a game. In other words, comprehending the culture, social values and its differences can
mean winning or losing the contract at the first meeting (Moran, Harris and Moran, 2012).
With the help of social values, companies can build up a good reputation. Further, they can
also influence the behaviour of other individual. In addition to this, the social values also help
in altering the way one’s business is sighted by the rest of the world (Schein, 1990).
India and Indonesia are two of Asia’s most booming economies. After India got
independence in 1947 the process of economy reconstruction started, and the population of
India played a major role in redeveloping the economy. But both the countries are facing
huge problems in growth of their economy, problems like population explosion, poverty and
unemployment. In both the countries labour charges are too low so the operating cost may not
create wealth for workers in those factories. For most economies culture is a black box which
contains such information’s which is not so easy to understand but plays a major role in
economy.
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Social values play a very important role in each and every firm. In fact, it is more vital
as compared to the strategy of business (Zhang and Tansuhaj, 2007). The innovation and
strategic decisions of the organization will fail, if the culture and social values of the
company is not good. In other words, if organization comprehends the social values of a
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References
Books and Journals
Bergitte, B., 1991. The Culture of entrepreneurship. ICS Press.
Boettke, P. and Coyne, C., 2007. Entrepreneurial behavior and institutions. Westport, CT,
Praeger Press - Greenwood Publishing Group.
Casson, M. 1982. The Entrepreneur. Oxford, Martin Robertson
Chung S., M., 2004. How to Do Business in Indonesia. Dorrance Publishing Co.
Freytag, A., 2010. Entrepreneurship and Culture. Springer.
Hofstede, G. and Nooderhaven, N., 2004. Culture's Role in Entrepreneurship: Self
Nayab, N., 2011. Starting and Opening Business. London, Allen & Unwin.
North, D. 1990. Institutions, Institutional Change and Economic Performance, Cambridge
University Press.
Penrose, E. 1959. The Theory of the Growth of the Firm. Oxford, Oxford University Press
Shane, S. 2003. A General Theory of Entrepreneurship. Cheltenham, Edward Elgar.
Online
Organization Code of Ethics. n.d. [Online]. Available through: <http://rcrmc.org/home/index.php?option=com_content&view=article&id=5&Itemid=5>. [Retrieved on 13thDecember 2012].
Heaps, H., 2009. Why Culture is Important in International Business. [Online]. Available through: <http://www.internationalhrforum.com/2009/06/08/why-culture-is-important-in-international-business/>. [Retrieved on 13thDecember 2012].
Organizational culture. n.d. [Online]. Available through: <http://openlearn.open.ac.uk/mod/oucontent/view.php?id=403948§ion=3>. [Retrieved on 13thDecember 2012].
Schein, E.H., 1990. Organizational Culture. [Online]. Available through: <http://www.machon-adler.co.il/readers/reader56.pdf>. [Retrieved on 13 thDecember 2012].
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Freie Unversitat,2001. Creating a Culture. [pdf] Available at: Website: < http://www.ewi-psy.fu-berlin.de/einrichtungen/arbeitsbereiche/entrepreneurship/media/literatur/jibe_offprint.pdf?1286347485 >. [Retrieved on 13th December 2012].
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