THE IMPACT OF CULTURE DIFFERECES ON INTERNATIONAL BUSINESS (A CASE STUDY OF PT. SHENWU INDONESIA)

Abstract

Along with the internationalization in most industries, international business is becoming more and more needed and thus more and more frequently we are dealing with international business. Many companies start to make strategies of investing abroad to expand their business. They have various ways and different structures to implement their investments, while the number of investors keeps increasing; that how many of them have succeeded is not very impressive. It is certainly true that when companies operate abroad, its operating environment changes and they run into many problems and obstacles that they didn‟t have when they operate domestically. One of the most obvious and important is the culture difference impact. This thesis is thereby made to explore the impact of such culture difference on international business. This impact might be multi-aspect and complex, which lead to the importance and complication of doing this research; however, on the other side, this also indicates that it is crucial for companies who are interested in investing abroad or already making business abroad to clearly aware of the impacts and making strategies accordingly. This research will use Chinese Company investing in Indonesia as a case to explore how culture difference makes impacts on international business. In this research, the researcher uses the theory of Professor Geert Hofstede's cultural dimensions as the basic model, from power distance (PDI), individualism (IDV), uncertainty avoidance (UAI), masculinity (MAS) and long term orientation (LTO) five aspects, to analyse culture difference impact on international business between China and Indonesia.