The Strategic Role of Cultural Risk Management in International Business

This study examines cultural risk as a key factor in organizational strategy, bridging cultural studies and the risk management literature. Despite its significance, culture as a risk driver remains underexplored, partly due to a lack of consensus on its definition. Existing research predominantly relies on Hofstede’s model, treating culture as a static, measurable construct, overlooking its dynamic and heterogeneous nature. To address this gap, this study explores cultural risk components through 34 interviews with senior managers in international business. The findings suggest an innovative approach, integrating strategic management perspectives, considering external product-market positioning, and internal resource-based views to better capture cultural dynamics. The study proposes a unifying framework where cultural risk management functions as knowledge management, guided by the principle of requisite variety. This framework offers practical insights for both researchers and practitioners in managing cultural risk effectively.