Why Culture Matters in Global Business

Why Cultural Intelligence is Your Competitive Advantage in Business

Cultural Landmines: One Misstep Can Cost You Millions

A 2018 M&A report from Mercer (now part of Marsh McLennan) found that 30%
of transactions fail to ever meet financial targets due to cultural issues.

That was during relatively stable times. Today, global companies are navigating geopolitical instability, supply chain disruptions, shifting market dynamics, and high-stakes cross-border relationships — a volatile mix where cultural landmines often go unnoticed until the damage is done.

“Until I came to IBM, I probably would have told you that culture was just one among several important elements in any organization's makeup and success — along with vision, strategy, marketing, financials, and the like... I came to see, in my time at IBM, that culture isn't just one aspect of the game, it is the game. In the end, an organization is nothing more than the collective capacity of its people to create value.”

— Louis V. Gerstner, Jr., Former CEO of IBM

Culture and the Power of Perception

Ask ten people to define culture, and you’ll likely get ten different answers. Some might focus on traditions, language, or food. Others may speak of shared values, beliefs, or customs. And all of them would be right — partially.

But here’s the challenge:
We don’t just observe culture — we interpret it. And often, we do so through the lens of our own experience.

Perception plays a powerful role in how we engage across cultures. We make assumptions, draw conclusions, and form judgments — all shaped by the “water” we swim in. That’s why cultural misunderstandings can feel so subtle, yet cause such significant impact.

To better understand culture, we must first recognize how invisible it can be — especially our own.

Which brings us to one of the most useful ways to think about culture:

👉 The fishbowl.

Cultural Awareness Begins with Self-Awareness

Culture isn’t just about language or etiquette — it shapes how we make decisions, manage time, build trust, and respond to authority. These patterns run deep, but we rarely notice them — because we’re operating inside our own default culture.

True awareness often begins when we encounter a different cultural norm. That contrast forces us to reflect. Like the goldfish that doesn’t know it’s in water — until it’s out of the bowl. We don’t see our own assumptions until someone else challenges them.

Goldfish jumping from one bowl to another

🎯 When culture is misunderstood, the consequences can be costly. Explore our Global Marketing Blunders page to see how leading brands have misstepped — and what it teaches us about cultural intelligence.

Why Culture Is a Multi-layered Framework — Not a Checklist

Culture isn’t a checklist of dos and don’ts. It’s a multi-layered framework — shaped by national identity, organizational norms, group values, and individual experiences. These layers don’t cancel each other out; they overlap in complex ways that influence every business interaction.

Even within a single culture, these layers affect how people lead, collaborate, give feedback, and define success. Now multiply that by every other culture you engage with — each bringing its own layered framework. Misreading those dynamics leads to confusion, lost credibility, and missed opportunities. It’s the hidden complexity many companies don’t understand until it’s too late.

Concentric circles representing layers of culture

Contact us today to explore how our training and coaching solutions can equip your team to succeed — whether you're tackling global initiatives or navigating complex cross-cultural challenges. We welcome the opportunity to support your goals — across cultures, across borders, and across the global landscape.