Cultural barriers can make unpredictable problems as companies set up offices and production around the world. Critic of the multinational corporation usually views it as an economic and often political means of foreign domination. Many organizations, global diversity and cultural differences are seen to be difficult to overcome rather than as tools to be influenced for business success. Although more than 75% major American companies focus on diversity as a strategic advantage and business leverage in the U. S. there is minimal carry over internationally (Digh, 2001). These companies find themselves in the perplexing position of attempting to “roll out” overseas those diversity initiatives that were designed for a domestic workforce in many cases without knowing why or how (Digh, 2001).
Understanding the nature of diversity helps businesses to understand a culture’s needs and wants to help in combine international products with domestic products in an ethical system, to reduce any communication mistakes with customers. Reliable and solid culture is very important because to have the capability to uphold a steady culture. Managers need to understand the similarities and differences across national boundaries, so to decide to hire locals or international staff can be an issue and how to compensate. Language barriers and communication are a common topic when it comes to diversity, communicating international products domestically or vice versa, using signs or languages that another country does not use or accept can pretense as to a misleading outcome, as a result damaging the communication attempts’ individual meaning.
Diversity is an important topic in the international area because our human history is based on diversity which represents the common legacy of humankind and beyond diversity; it is embedded in agreement and unity. Over the last decades, international population has agreed to quite a few legal channels on the matter of cultural diversity and human rights, in order to expand and improve the approach of views and for finding ways to broaden and extend our common awareness.
Cultural diversity and skills of multicultural and multiethnic groups are often ignored. Cultural diversity cannot be ignored. Tourism and hospitality companies that operate in an international environment need to learn about their culturally diverse workforce and how to manage it. Tourism and hospitality industries have to adapt to the multicultural environment of its workforce; otherwise the relationship between customers and employees may be threatened Reisinger, 2009).
Politics and international relations play a very large role in international business. Political stability, conflict and wars, trade embargoes, terrorism, natural catastrophes, international aid, laws and regulations, human rights issues all affect how a business conduct in a foreign country. Events such as protests, riots, local or national elections, can create timing issues or setbacks in an international business expansion. Issues managers of foreign countries could face bribery and child labor.
Bribery makes considerable economic inadequacy, as well as ethical and legal problems in the global arena. International bribery take for granted many appearances, but wherever the practice happens, it slows down economic development and interferes with competition. It disrupts distribution