As the 21st century begins to unfold, globalization has become more than just piece of fancy jargon of the business lexicon. In fact, globalization in the sense of firms from all over the world interacting and dealing with each other is expected to be the normal state of affairs for the majority of businesses [1]. In the industrial or business-to- business sector, this pattern may be even more pronounced because advanced communications and transportation technologies have the potential for enabling the laws of comparative advantage to be realized to a very high degree. Thus, businesses that were used to dealing with other businesses from or over the country will now seek relationships from all over the world. Internet-based B2B E-commerce, has, of coursrse, been at the vanguard of the expected revolution in the way global business will be conducted in the future and has led to uncounted predictions of a worldwide e-business revolution where virtually all industrial firms will be linked together in a gigantic electronic global network [2,3].
Yet, this scenario seems a bit too simplistic. All of the hype about global B2B E-commerce, networks, hubs, electronic auctions, etc, implies that the only thing standing in the way of electronically linked businesses on a global scale is the right technological hardware and software that, once put in place, will have global businesses operating with the precision and reliability of a Swiss watch. After all, this technocentric view suggests that the only difference between operating around the block or around the world is the right satellites, telecommunications networks, and supply chains in place to solve this problem of distance [4].
The purpose of this article is to show that there is more to distance in global business-to-business relationships than mere geography. Distance can also be defined in terms of culture so that one can think of "cultural distance" as a challenge that must be addressed by business from different countries around the globe who seek to deal with each other.