Understanding U.S. Business Culture
In this chapter we aim to provide a better understanding of cultural differences between the U.S and Benelux business culture and we will indicate key cultural factors that differ between the U.S. and the Benelux region. In both the quantitative and qualitative part of this study the respondents indicated that they experienced challenges in their expansion process that could be accounted to cultural differences.
“If you don’t adapt to America culture, you won’t make it.”
“Cultural Differences between the US and the Benelux are significant and require open communication and understanding.”
Navigating Cultural Differences in U.S. Market Expansion
In the qualitative interviews one entrepreneurs explained that it is necessary to delve into the cultural differences between the U.S. and the given parent country when expanding to the U.S. They elaborated that it is important to shed light on the challenges and cultural nuances when making expansion efforts. They emphasized that just using the same approach for you U.S. Inc and parent company just won’t work in the U.S. based on their experience. Another Benelux company confirmed the above statement and added that taking a good look at the cultural differences when expanding to the U.S. will help you to approach people better and eventually help your business. These cultural differences, including communication styles and work practices require ongoing dialogue and efforts to bridge the gap between the two given cultures.
One of the respondents who was previously active on the U.S. market but has exited the U.S. market (group 3) indicated that the cultural differences and the additional challenges it brings in remote relationship-building hindered them in their efforts to expand to the U.S. which contributed to financial losses and ultimately led to their decision to pause operations and exit the U.S. market.
A recommendation that was frequently brought up in the qualitative interviews to face these cultural challenges is to seek advice and insights from TABS and other professionals who have a better understanding of the way of doing business in the U.S. and the cultural differences that come with it.
“We realized the challenges of doing business in the US and the importance of cultural adaptation and establishing personal connections."
“We learned valuable lessons about the complexities of the US market, emphasizing the need for cultural understanding and personalized engagement strategies to succeed.”
Cultural Data
The quantitative part of this study shows that a majority (74%) of Benelux ventures operating with a U.S. entity (Group 1) experienced cultural differences when expanding their business to the U.S. This data aligns with the findings of the 2020 DVITUS research (TABS, 2020). Among this group, 21% identified the most significant cultural differences when building a team in the U.S., as well as in salaries and work benefits. Other frequently mentioned cultural differences included the hiring process (17%) and collaborating with U.S. partners (14%). These findings indicate that many respondents in this study encountered cultural differences primarily within HR-related challenges.
Experiences cultural differences while doing business in the U.S
In the qualitative interviews, respondents frequently highlighted HR-related challenges when discussing their experiences with cultural differences in doing business in the U.S. These challenges were often linked to managing a team and feedback mechanisms. Most respondents noted that their management style and method of delivering feedback were perceived as too direct by their U.S. employees. One venture shared that when they hire someone new, they always clarify that they are not a typical American CEO, where direct questioning might be discouraged. They explained that in American work culture, employees often hesitate to inform their CEO when something is wrong due to fear of being fired. Therefore, it is recommended to be aware of this cultural nuance and actively encourage open feedback. This approach, though different from typical American work practices could be essential for effective team management.
Another venture in this study emphasized the importance of not only fostering open communication but also establishing personal connections with your U.S. employees. They shared that their U.S. employees valued sincere personal and spiritual interest and care in the workplace, as this is less common in the more individualistic and polarized U.S. culture. This suggests that adapting management styles to the nuances of American culture is necessary. Rather than directly replicating strategies from the parent company, it is crucial to implement and adapt elements that are tailored to suit your U.S. team.
The quantitative part of this study also shows that around 34% of the ventures in this study operating with a U.S. entity (group 1) prepared themselves for these cultural differences by attending in cultural seminars. This is a bit less compared to the results of the 2020 DVITUS research where 41% of the respondents prepared for these cultural differences.
“Understanding cultural nuances in communication styles is crucial, as Americans may not always express opinions directly, which differs from European norms.”
“We realized the challenges of doing business in the US and the importance of cultural adaptation and establishing personal connections."
Cultural Preparation
The lower rate of Benelux ventures preparing for cultural differences compared to the previous study in 2020 suggests that there is still an underestimation of the importance of understanding and preparing for cultural differences when expanding into the U.S. market. In the qualitative interviews, some ventures acknowledged that sentiment and stated that with their current knowledge of the U.S. market, they would have placed greater emphasis on cultural preparation.
Prepared for these cultural differences by attending seminars
One entrepreneur in this study recommended that all Benelux ventures should take the time to prepare for cultural differences, even if only to prepare their expats for what to expect and how to respond in various situations. Most ventures found it crucial to find an effective way to prepare for these cultural differences. This preparation can include attending cultural training seminars, engaging with cultural consultants, and providing resources for their teams to better understand the nuances of American business practices.
It should be noted that it is important to select the right type of cultural preparation tailored to the specific needs and contexts of the business. While some cultural training programs may not perfectly align with every situation, they can still offer valuable insights and strategies for managing cultural differences.
“Have a good look at the cultural differences and prepare for them by getting advice of TABS or other professionals. “
Country Mapping
To gain a deeper understanding of the cultural differences between the Benelux region and the U.S. in a business context in this study, we will utilize Erin Meyer’s Cultural Mapping Tool. This tool allows for the comparison of different countries across several core cultural dimensions (Meyer, 2014). For this study, we mapped the United States, Belgium, and the Netherlands. Unfortunately, Luxembourg could not be included in this comparison due to the tool's limitations.
We observe that in certain dimensions, such as trusting and scheduling, the United States and the Netherlands exhibit significant overlap. Conversely, Belgium and the United States show closer alignment in dimensions like agreeing and, to a lesser extent, evaluating. However, dimensions such as persuading reveal a larger cultural gap among all the countries considered.
Below, we will delve into the cultural dimensions that are particularly relevant to this research and were frequently highlighted during both the quantitative and qualitative phases of this study. We will also delve deeper into the specific cultural differences between the three different countries.
Click on each of the titles to learns more about the cultural dimensions that are particularly relevant to this research and were frequently highlighted during both the quantitative and qualitative phases of this study.
Differences between the Mapping Countries
To conclude this chapter, let's delve deeper into Erin Meyer's mapping tool to uncover key differences in business culture between the U.S., Belgium, and the Netherlands that haven’t been previously discussed.
Communication Style
Dutch and Americans share a low-context, direct communication style known for its clarity and straightforwardness. This means messages are conveyed clearly and directly. In contrast, Belgians use a more nuanced, high-context approach, relying on context, non-verbal cues, and subtle language. This diplomatic and indirect style can be harder for outsiders to interpret.
Trust-Building
Trust-building varies among these cultures. Belgians build trust through tasks, personal connections, and professional competency, valuing relationships and social interactions. The Dutch and Americans, however, build trust through transparent and candid communication, emphasizing openness and honesty.
Scheduling
Punctuality and structured schedules are important in all three countries. Americans and Dutch strictly adhere to schedules, reflecting a cultural emphasis on efficiency and time management. Belgians also value punctuality but are slightly more flexible, allowing for more spontaneous interactions due to their high-context communication style.
Agreeing
Approaches to agreement and conflict resolution differ significantly. Americans are open to debate but prefer to avoid direct confrontation in public, favoring diplomacy to maintain harmony. The Dutch, however, are comfortable with direct confrontation, valuing honesty and transparency even if it leads to disagreement. Belgians, like Americans, prefer indirect and diplomatic methods to preserve harmony, addressing disagreements subtly to reach consensus and maintain positive relationships.
