Scancrm Company - online Customer Relationship Management Software Systems

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5.4 Hierarchy

China Business Culture have strong emphasis on hierarchy to show the distinction between different levels of management. Leaders and managers in China demand respect from their subordinates which means to obey without any questions asked. During a meeting, people are expected to enter the meeting room according to hierarchical order and only senior management are allowed to lead the discussions (Kina.um.dk 2015).

5.5 Respectful Attitude

Cultural differentiations are one of the most sustainable feature that organisations need to take under consideration, in a strategic planning of setting up abroad. They need to be progressively more aware of foreign cultures in order to be successful in an international environment. One of the general attitude companies could adopt for respecting any of the four fundamentals is to adopt a respectful attitude (Moran 2013). By respecting the fundamentals of the business systems, it builds trust in cross cultural communications and avoid awkward and unpleasant situations (King 2015).

6. Cultural and Business Factors

Organisations need to bear in mind some factors namely motivation, status oncern and perceptual issues as it could cause impact in conducting businesses in China.

6.1 Motivational Factors

Motivation acts as an impetus within individuals that drives them to action (Schiffman et al. 2014). Motivation is a factor that is difficult to measure as it works at a subconscious level. Individuals often have different needs and wants, due to the diverse environment and cultural background. Individual’s behaviour in achieving goals may vary from one to another. It is challenging to accommodate everyone as a country may have more than one culture.

6.2 Status Concerns

In China, with a population of more than a billion people, living in hundreds of different cities, the culture from each cities differs from one to another. Individuals from the city are more likely to be motivated for a higher social status or a better life, whereas individuals from rural areas are satisfied with a simple and quiet life.

6.3 Perceptual Issues

People with different cultural views observe things differently. For instance, the western culture encourages individualism, hence people from western cultures are particularly challenged in their capability to understand other people’s viewpoint. On the other hand, Chinese society encourages a socialist attitude, which helps the people to recognize another person’s perception (Nauert 2007).

7. Differences Between Northern and Southern China

Psychological differences between the people of Northern and Southern China mirrors the differences between community-oriented East Asia and the more individualistic Western countries.

Northern China is colder and the land is considered less fertile and barren, thus more suitable for wheat farming, however Southern China is warmer, making it more suitable for rice farming as the land is more fertile (Samarrai, 2014).

Farmers in Northern China are more independent as wheat farming requires less teamwork and effort as compared to rice farming which requires more team effort and cooperation from neighboring farmers such as sharing of water for irrigation purpose, and building of infrastructure that has to be constantly maintained.

It can be deduced that Northern Chinese are more individualistic and analytical, however they are more straightforward and has a higher level of utilitarian approach to life. Whereas Southern Chinese are more interdependent, holistic-thinking and loyal. They are more concerned with their public ideal image and social status thus setting higher goals for materialism (Smith, 2012).

8. Conclusion

From the factors listed above, ScanCRM did not take into account of the cultural differences between China and Australia while trying to expand their operations into the China market. The failure in understanding China’s business culture led to the failure of ScanCRM. The organisation should have broaden their depth of knowledge and understanding of China before venturing into the market. Alternatively, they could hire professionals who have expertise in cultural understanding.

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9. References

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Clemons, Eric, Paul Nunes, and Matt Reilly. 2014. 'Six Strategies For Successful Niche Marketing'. WSJ.

http://online.wsj.com/articles/SB10001424052748704130904574644084205858424.

INSEAD Knowledge,. 2013. 'So You Think You Understand Asian Business?'. http://knowledge.insead.edu/economics-finance/so-you-think-you-understand-asian-business-2368.

Kina.um.dk,. 2015. 'Business Culture'. http://kina.um.dk/en/the-trade-council/china-as-market/business-culture/.

King, Cindy. 2015. 'Adopt A Respectful Attitude - Cindy King's International Business Blog'. Cindyking.Biz. http://cindyking.biz/trust-in-cross-cultural-communication-–-tip-21/.

Moran, Gwen. 2013. 'How To Avoid Cultural Missteps When Doing Business With Other Countries'. Entrepreneur. http://www.entrepreneur.com/article/226286.

Nauert, Rick. 2007. 'Culture Influences Perception'. Psych Central.Com. http://psychcentral.com/news/2007/07/13/culture-influences-perception/1011.html.

Samarrai, Fariss. 2014. '‘Rice Theory’ Explains North-South China Cultural Differences, Study Shows'. UVA Today. http://news.virginia.edu/content/rice-theory-explains-north-south-china-cultural-differences-study-shows

Schiffman, Leon G, Aron O'Cass, Angela Paladino, and Jamie Carlson. 2014. Consumer Behaviour. 6th ed. Australia: Pearson.

Smith, Nicole. 2012. 'Cultural Differences Between China’S Northern And Southern Regions'. Articlemyriad.Com. http://www.articlemyriad.com/cultural-differences-china-northern-southern-regions/.

Upton-McLaughlin, Sean. 2013. 'Gaining And Losing