The goal of production, from an economic perspective, is to minimize costs, maximize profits and maximize efficiency. This involves putting to use the best practices. When searching for best practices, cultural diversity in the workforce can be very beneficial. By integrating multiple cultures a business can add a different set of skills and knowledge. There is an increased base of different views and ideas. This can lead to the creation of new procedures, designs, technology, etc.

Fiat is an international car manufacturer based out of Italy. It decided to introduce a car to emerging markets. These markets had inferior road conditions not suited for the majority of Fiat makes and models. The company got together a team of designers from Argentina, Brazil, Poland and Turkey who all had experience designing cars for roads in poor condition. This diverse team brought together the knowledge and skills necessary to perform the task at hand.

CS Question #1: Can you think of why cultural diversity in the workforce may be challenging as well as rewarding? Try to think of two examples of challenges and/or rewards a business with a diverse workforce might experience.

Distribution, how goods and services are sold and delivered, is a key economic factor. Individuals and businesses respond to distribution based on their cultural perspective. Think about advertising on television. Have you ever noticed how certain commercials are aimed at different segments of the population? For instance, during a cartoon, advertising for children's games and toys may be aired. Such commercials often include child actors expressing enjoyment at playing with the advertised toys. The advertising is aimed at a segment of the population or a sub-culture. In this case the commercial is aimed at what is often referred to as the youth culture.

In an international market it is important to recognize the importance of the medium of distribution. Sometimes a medium of distribution is not readily accessible because of cultural differences. Japan's economy is built on corporate giants such as Sony, Fujitsu, Toshiba and Matsushita. Culturally, Japan believes in structure and hierarchy. Therefore, there is a lack of entrepreneurial influence. This has caused a recent challenge in engaging in e-commerce.

E-commerce has been a huge success in the United States. It is built by entrepreneurship, specifically: Internet start-ups, portals and Internet providers. Japan's lack of entrepreneurship has handicapped their growth and speed in e-commerce. Japan has not utilized the additional profit motive of stock opinions and IPOs that have driven the U.S. success. In 1998 Japan sold $500 million worth of goods and services online. This is about 3 percent of the sales in the United States. Japan is known for its technological skills and abilities. The human capital resources of technology and business experts are rising to this challenge. The e-commerce market in Japan is expected to grow at a rate of 200 percent. There is a strong drive to adapt the corporate culture to meet the needs of e-commerce.

CS Question #2: How are entrepreneurship and profit motive examples of cultural values?

The consumption of goods and services is highly relative to cultural beliefs and traditions. How does a culture define it needs and wants? What are the taxes and committed expenses that affect discretionary income? In Iran there is a voluntary religious tax. Islamic taxes are collected on income, land, value of crops and a relative amount for charitable causes. Iranians who contribute to this tax make their religion a priority over their discretionary income. In North Korea over 20 percent of the labor force works on cooperative farms where food rationing is common. A want for North Korean farmer, such as new boots, may be considered a need to an U.S. farmer. In India the majority of men and women still wear the traditional draped cloth apparel, the dhoti and sari respectively. In India there is a higher demand for silk and fabric then there is for trendy fashions.

What services we choose to consume are highly influenced by culture. Much of the consumption of services involves communication. Individuals like to communicate in their own culture. Specifically this may mean that they prefer their own language. It can also mean involve other areas of culture. Some women prefer having women doctors. An individual may prefer a lawyer from their own cultural background, as their lawyer represents them to the court. When searching for a home, individuals are likely to work with a real estate agent that represents their intended community's culture.

CS Question #3: Can you think of a good or service you consume that is influenced by your cultural identity?

The move towards a global economy causes cultures to integrate. Technology has rapidly sped up this process. Cultures are changed by the influence of other cultures they interact with. This can be exciting and also scary. It is important to remember that the cultures that have the most influence are those that control the most technology, media, production and distribution sources. This means that a limited amount of cultures have more influence on the world culture. As newer generations are more adaptive to a world culture, there is a fear that the traditions and values of societies and cultures will be lost. This desire to retain cultural values may influence protectionist trade policies. Considering the technology available, such a policy would only slowdown the cultural penetration, not halt it. It is a constant challenge for nations to balance this influence against their own cultural heritage.

CS Question #4: What are some ways that a society can blend their culture with the evolving world culture?

Further Thought:

1. Give advice to a team of culturally diverse employees who are working on a project together. How should they communicate, make decisions and resolve conflict.
2. How does culture play a role in how students learn? Try to think of an example from your own experience or in your school.
3. What is your opinion on the ability of difference cultures to influence a world culture if they participate in world exchange? What kind of role do population size, economic power and stability play in this ability?