American Business Customs A Quick Guide to Conducting Business in the USA
Cultural Context • Geert Hofstede™ Cultural Dimensions 1) Power Distance (PDI) - the extent to which the less powerful members of organizations and institutions accept and expect that power is distributed unequally. 2) Individualism (IDV) - the degree to which individuals are integrated into groups (opposite of collectivism) 3) Masculinity (MAS) - versus its opposite, femininity, refers to the distribution of roles between the genders
Cultural Context 4) Uncertainty Avoidance (UAI) - deals with a society's tolerance for uncertainty and ambiguity 5) Long-Term Orientation (LTO) - versus short-term orientation; values associated with long- term orientation are thrift and perseverance; values associated with short-term orientation are respect for tradition, fulfilling social obligations, and protecting one's 'face'
Cultural Context • How does the USA score?
The low score for Power Distance is indicative of a greater equality between societal levels, including government, organizations, and even within families. • The high Individualism ranking for the United States indicates a society with a more individualistic attitude and relatively loose bonds with others. The populace is more self-reliant and looks out for themselves and their close family members. • The high Masculinity score indicates the country experiences a higher degree of gender differentiation of roles. The male dominates a significant portion of the society and power structure. This situation generates a female population that becomes more assertive and competitive, with women shifting toward the male role model and away from their female role.
A low ranking in the Uncertainty Avoidance Dimension is indicative of a society that has fewer rules and does not attempt to control all outcomes and results. It also has a greater level of tolerance for a variety of ideas, thoughts, and beliefs. • The low LTO ranking is indicative of the societies' belief in meeting its obligations and tends to reflect an appreciation for cultural traditions.
Cultural Context • Very generally… • America has a large and diverse culture with a strong emphasis on freedom of expression • Americans are generally polite but they will stand up for what they believe • They are not shy in voicing an opinion • There is not much an American will not talk about except possibly strong personal convictions such as religion • They love humor and sarcasm and can even joke about themselves
The Business Setting The Wheres, Whens, and How-To-Dos
Corporate Culture • Built into the United States work concept is the idea of the 'American Dream' that every individual can succeed and prosper financially by working hard. • This idea contributes to a strong work ethic and a system that is merit based [believing that hard work deserves compensation]. • Americans work long hours, take, on average, two weeks of vacation, and spend a lot of time doing work-related travel.
Corporate Culture • In the United States, business relationships are formed between companies rather than between people. • Americans do business where they get the best deal and the best service. • It is not important to develop a personal relationship in order to establish a long and successful business relationship.
Corporate Culture • Do not enter into any contract without hiring a lawyer. • Americans are often uncomfortable with silence. Silence is avoided in social or business meetings. • Americans ask questions -- lots of them; Americans will assume you understand something if you do not tell them otherwise.
Communications • Americans prefer directness in communication - when Americans say "yes" or "no," they mean precisely that. • It is rude to interrupt someone who is talking. Say, "Excuse me" during a pause and wait to be recognized. • Americans put a great deal of value on the written word; verbal contracts are rarely legally binding.
Communications • Good eye contact during business and social conversations shows interest, sincerity and confidence. • A smile is a sign of friendliness, and in rural areas you may be greeted with a "hello" rather than a handshake. • Good friends may briefly embrace, although the larger the city, usually the more formal the behavior. • It is very important in written communication to spell names correctly and have correct titles.
Behavior • Business conversation may take place during meals. However, many times you will find more social conversation taking place during the actual meal. • Gift giving is discouraged or limited by many US companies. A gracious written note is always appropriate and acceptable. • Business meetings may be arranged as breakfast meetings, luncheon meetings, or dinner meetings depending on time schedules and necessity.
Behavior • Little business is conducted on Sundays. This is the standard day of worship for many religions. If your stay in the U.S. is short, however, your American business counterparts may arrange to do business on this day. • When you are doing business in the United States, you must be on time; being "on time" in business situations generally means being about five minutes early. • It is very important to meet deadlines - people who miss deadlines are viewed as irresponsible and undependable.
Meetings • Meetings are generally informal and relaxed in manner, but serious in content. • Be prepared to begin business immediately, with little or no prior small talk. • A meeting is only considered successful if something concrete is decided or accomplished. • Participation is expected in meetings. A quiet person may be viewed as not prepared or as having nothing important to contribute.
Appearance • Men: Business suit and tie are appropriate in all major cities. • Women: Women should wear a suit or dress with jacket in major cities. • Rural areas and areas with extremely warm summers have more informal wardrobe requirements. • The best approach is to be conservative until you have had a chance to observe what others wear in an office.
Negotiating • Generally, there is one negotiation leader who has the authority to make decisions. Team negotiations are rare. • Americans may begin negotiations with unacceptable conditions or demands. They are usually taking a starting position that gives them room to bargain. • The goal of most negotiations in the United States is to arrive at a signed contract.
Negotiating • Long-term relationships and benefits may not be the main objective; the immediate deal may be the only important issue. • Negotiations may seem rushed to you. Remember that "time is money" to Americans. • In general, people from the U.S. will not hesitate to answer "no." Businesspeople are direct and will not hesitate to disagree with you.
Individual Business Cultures • Regional background should be taken into account when learning about American businesses. • Individual factors including industry, business structure, management, and business mission also play a strong role in shaping an individual business culture. • Those wishing to do business with specific companies should invest additional time researching individual business culture through corporate literature, marketing, and websites.
Website Links • http://www.businesstravelogue.com/United$20States$20of$20America.html • http://cyborlink.com/besite/us.htm • http://executiveplanet.com/index.php?title=United_States • http://www.geert-hofstede.com/hofstede_united_states.shtml • http://www.siliconiran.com/research/market/market_analysis/usa/usa_customs.shtml