How cultural understanding influences business success in Middle East and North Africa (MENA)

Abstract

Technological innovations in communication, transportation, and the internationalization of national markets has led leaders of corporations of all sizes to increase interconnectedness and relationships within all aspects of life. Distance is no longer a barrier, the world has been shrinking and hierarchical geopolitics are flatter; that is, the world has become smaller and national boundaries matter less. This increased integration has benefited economic growth and the interrelationship among various cultures and people. Economic interdependence has led to increased competition among corporations to achieve sustainability and expand demand for products and services to meet customers' expectations. Geopolitical boundaries do not restrict seemingly borderless businesses in the fields of information access, education, markets, capital, products, and services. This situation is very different from 19th century railroad transportation and 20th century mass-production manufacturing in which competition operated mainly amongst neighboring regions. Three emblematic factors characterize globalization: the technological revolution, cross-regional dialogue, and cultural diversity, which have proved to be catalysts for the growth of business. Developments in technology have caused organizations to change the business culture and change how people communicate between organizations. Friedman [10] linked information advancements to the world he described as flattened and shrinking, driven by culturally diverse organizations that value diversity of people. Noting technology's transformative potential, Friedman [10] explained, "With interconnectivity, work could be moved around to the four corners of the world through the creation of a global platform for a global workforce of people" (p. 67). The specific problem is that American multinational organizations operating in MENA may lose business opportunities due to the lack of business leaders' understanding of cultural differences. American global organizations possibly encounter weakened organizational performance because of the shortage of culturally competent American business leaders regarding the cultures of the MENA region [19][22][25]. This paper exposes the importance of increased insight into cultural differences, which may enable leaders to achieve substantial results by appropriately preparing employees to accomplish organizational missions. Focusing on cultural differences could assist educators, leaders to develop strategic cross-cultural approaches to transform educators, managers into global strategic leaders. Leaders may need to seek a deeper understanding of the peculiarities of the host culture and style of leadership and management, and to look for continual improvement.