The Effect of Cultural Differences on International Business

For example, if a meat company that offers a healthy amount of pork and pork-related products wanted to expand in the multinational market, it would not want to place a deep influence on expanding in countries with a large Muslim population. Muslims, by religious decree, are not allowed to eat pork, or pork-related products. A decision to expand this company into a traditionally Muslim country would not be a very intelligent one. Different needs of people in different countries affect the business and economy relative to each country (Belkaoli 88). This is an important factor to take into effect when constructing foreign managerial styles. The cultural environment of the country or region in which an entity wants to expand unto highly effects the operations and/or production of the business.
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             Many American people believe in the way of the American economy, However, The way America runs its finances is not necessarily right. The ways in which a countries economics work are all unique, with respect to that country (Burns 57). A nave business mind will assume that the way business is practiced in America is the way it is practiced outside of America. Managerial styles and techniques, among other things, need to be devised and learned in order for a business to survive in a foreign host country. Plainly put, certain managerial decisions could be the key to a multinational enterprise's success, or failure. This is evident in densely Muslim countries. Since, in some cases, the Muslim religion prohibits the charging of interest, there hardly exists any strong interest-based businesses; Moreover, if interest-based businesses do exist, there is not a great chance that elaborate accounting procedures relating to interest will exist (Radebaugh 5).
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             More and more, the corporate world is beginning to realize the effect that managers have on international business. Managerial executives are increasingly " faced with the problem of making decisions based on financial statements that have been prepared using accounting principles which vary from country to country- (Evans 17).