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Culture of a society has been defined as a shared set of values and beliefs by Hofstede, and it is common to members of the group and separates them from other groups (Hofstede, 1997).
Why it is important for international managers to understand it?
Management is getting things done through (other) people. This is true the world over. In order to achieve this, one has to know the "things" to be done, and one has to know the people who have to do them. Understanding people means understanding their background, from which present and future behavior can be predicted. Their background has provided them with a certain culture (Hofstede, 1994).
Do you notice culture differences among your classmates?
Definitely, the word "culture" is used here in the sense of "the collective programming of the mind which distinguishes the members of one category of people from another" (Hofstede, 1994). The "category of people" in our class can be divided into a national group, region group, ethnic group, and gender group.
How do those differences affect the class environment or your group projects?
Generally speaking, cultural differences in our class have a positive effect because it enables us to grasp the idea that there are other visions and interpretations of the world other than our own.
Cultural difference is very common in our group projects or assignments. When cultural differences are recognized, valued and used to the group's advantage, then greater synergies can result for managing projects. Different approaches in multicultural performances consist of four identified key impacts: differences in problem-solving technique, decision-making process, communication methods, and level of trusting each other (Lee & Ma, 2006).
Critically assess the types of operational conflicts that could occur in an international context because of differences in attitudes towards time, change, material factors, and individualism. Give examples relative to specific countries.
Western cultures perceive time as a resource that is continuously depleting. Terms such as: time is money is often used to promote the effective use of time. This orientation is the reason for the western belief that there is a limited amount of total time. In contrast, for Asian and Russian people time does not begin at birth and end at death. This attitude towards time makes people quite casual about keeping appointments and deadlines, which make western people dealing with them very anxious and frustrated (Miroshnik, 2002).
For example, in Russia the time spent waiting outside a person's office beyond the appointed time is seen as a measure of the importance of the person waiting. Arabs have another interpretation: a businessman may keep a visitor for a long time, and if the businessman does see the visitor, the interview will last al long as may be necessary. In terms of the number of working hours, Japanese are known to their long working hours. One factor mostly affecting Japanese employees is the culture of not leaving the office before the boss. However, the philosophy is at total variance with the philosophy of Japanese, American employees believe finishing works in time is an expression of efficiency. Besides, in some countries, like in Southern Mexico, where the stereotypical "manana" attitude of conducting business at a leisurely pace can still be found.
In western culture, especially in the United States, people view nature as "frontier philosophers" that is humans are the masters of our nature and are most valuable among all the creatures, therefore, human should conquer, change and control nature for the benefit of humankind. However, in the Asian culture, like Egypt and Indian, most people worship of nature is the dogma even for persons whom religion is not the significant determinant of behaviors. The rivers Ganges in India, Nile in Egypt are revered for their power over the economic and physical wellbeing of the people (Kotter and heskett, 1992).
Most western people believe that the future is not predestined and humans are capable of manipulating the environment where they will live in future and can change it to their liking. Many US managers are like to introduce innovations to the organizations because they consider change as a positive business opportunity. For non- western people, they usually look on change as a phenomenon that occurs naturally and is part of the overall evolution of humans and their universe. Changes in their societies are accepted, but passively. For example, Muslim culture is passive to change due to the factor of gender role and religious practice (Miroshnik, 2002).
Individualism is the degree to which individuals are integrated into groupsï¼Œwhich describes the attitude of independence of the person who feels a large degree of freedom in the conduct of his/her personal life. Individualism is not considered crucial in Asian culture. For example, in Japanese culture, the individual success shared by a family, community and group is dominant I social life, therefore, conformity and cooperation are values that rank higher than individualism. By contrast, in western culture, individualism, which may motivate personal accomplishment and self-expression, is considered to be of the greatest worth (Kotter and heskett, 1992).
Leaders and entrepreneurs should learn the essence of the local national culture. Then they could create a certain philosophy for the company. When they implement these in a firm people behave according to their guided philosophy which lead to an emerging corporate culture that reflects the vision of the leaders and entrepreneurs they has while implementing these. Thus, leadership and entrepreneurship is the key issue in shaping organization culture (Boescu, 2003).
1. Overall, the French managers Monsieur Hulot look at the organization as an authority network where the power to organize and control the actors stems from their positioning in the hierarchy. They focus on the organization as a pyramid of differentiated levels of power to be acquired or dealt with.
After the careful study of Jo's CV, M. Hulot doesn't believe her qualification is adequate. That's because most senior management in most French companies were educated at the elite schools of France, which produces a highly educated management population that approaches leadership with an unusual degree of academic precision.
M. Hulot also regard the "airport picking up" as a very important thing, which implies his management style involves detail-focus and etiquette protocols.
Because of the rich and varied culture in France, the management also includes the protection of French language which is the major reason to the delay of the first meeting.
Generally, in the view of Jo, she believes that managers are not expected to see themselves as in any way superior to their colleagues - people just have different jobs, which can explain why she doesn't inform her French colleagues in advance to pick her up in the airport.
In addition, with the rapid development of globalization, Jo believes the business affairs of P3 should be operated in English.
After the poor start of the first meeting, Jo thought hard and adopted a new strategy to help her to accomplish the assignment, which shows pragmatism and individualism is also seen as a key attribute, getting the job completed quickly is more important than the quality of protocol or hierarchy for the Australian management style.
2. The first main force to multinational business is culture: communication is the major cultural difference in the international business. From the case, we can see because lack of efficient communication between two mangers, the first meeting was not processed successfully.
Another main problem to multinational business is domestic forces: in this case, we can know almost all the French employees speak their native language instead of English.
Lastly, one of the main problems in multinational business is conflict within companies and within international organization: difference of opinion in strategies to be adopted between different management levels in international business. If support is inadequate the international business proposal fails. In this case, if Jo didn't change her strategy to deal with the French constituents, it is very possible to see the failure of her proposal about shelf life of capsules.
3. Generally, the approach Jo used to deal with her French colleagues is showing the respect for them, in particular, for their pride in their work. Jo also tried to slow down the rhythm to work with her French colleagues, which is suited to slow lifestyle and working pace in France. The approach she used in this case is delivering a thanking speech before go to the major topic, which help herself establish a friendly image to her French colleagues.
In terms of the constituents of Philippines, the general approach Jo used is being initiative, professional and autocratic in the workplace but being friendly and easygoing after working hours.
Jo speaks up her suggestions to her Philippines colleagues directly and confidently because Asian employees are like to receive information and order rather than expressing their own opinions.
What do you think companies can do now to prepare managers for the new world economy and globalization? What can entrepreneurs and small business with limited resources do?
Table 1 Three dimensions of globalization and their relative advantages and disadvantages
Source from https://www.rienner.com/uploads/4fe34a9827174.pdf
Table 1 identifies three dimensions that are affected by globalization-political, economic, and cultural-and gives examples of aspects considered positive and negative.
A key aspect of political globalization is that globalization can reduce the state's sovereignty. This can be viewed as good, because undemocratic governments are finding it increasingly difficult to control the flow of information to and from prodemocracy groups. But decreased sovereignty also means that the state has difficulty controlling the influx of illegal drugs and unwanted immigrants, including terrorists (Ben, 1999).
At the economic level, globalization has given consumers more choices. Also, multinational corporations are creating jobs in poor areas where people never before had such opportunities. But critics of economic globalization argue that that increased foreign investment and trade benefit only a small group of wealthy individuals and that, as a result, the gap between rich and poor grows both within countries and between countries.
At the cultural level, increased cultural contact gives people more opportunities to learn about other cultures. However, some critics are concerned with cultural imperialism, in which dominant groups (primarily wealthy countries) force their culture on others. For example, more and more national languages will become extinct as foreign languages, especially English, penetrate borders.
Globalization is an objective phenomenon, which takes place in an accelerated rate, putting more and more its mark on the lives of most of the world's population. The consequences of the globalization of the economical activity are on cultural values specific for different countries. The importance and the phases of the process of training managers that can action with competence in an intercultural context to meet the globalization have represented the elements which I want to bring forward in following.
Cultural orientation programs for the perception and correct evaluation of cultural values and norms from the host country.
Training courses for learning a certain foreign language.
Cultural assimilation programs, which imply the simulation of certain situations in which the international manager might be while in contact with the new cultural environment (Boescu, 2003).
In addition to the giant corporate, small companies with limited resources also need to meet the challenge of globalization. The first key factors for a small company to survive in the globalization is the right niche market, small businesses have to compete by identifying niche markets that are too small for the big e-commerce sites and/or by offering a level of service that the big guys can't offer. Another strategy small companies can adopt is to building a good internet website through which word of mouth advertising within their own communities.
What are the claims of those who say globalization eliminates jobs, lowers wages, and exploits workers?
Globalization has both its advantages and disadvantages. In the realm of economics dimension, we can truly see how globalization encourages job growth within a country, as well leads to increased access to wages. However, some critics reject these points, arguing that increased foreign investment and trade benefit only a small group of wealthy individuals and that, as a result, the gap between rich and poor grows both within countries and between countries. The points below often are the three most cited reasons against restricting globalization.
Eliminates Jobs in Developed Countries: Many globalization protestors point out globalization leads to the elimination of many at-home manufacturing jobs in developed nations. The fact is numerous good-paying manufacturing jobs in developed countries were sent abroad to developing countries because of the lower labor cost in developing countries.
Forces Wages Lower in Developed Countries: In this scenario, these critics state that globalization results in worker dislocation thus lead to a steady slicing of wages.
Exploits Workers in Developing Nations: anti-globalization pundits claims that when a firm participates in international outsourcing of their production and services exploits those workers in low-wage nations.
Generally speaking, Yahoo can acquire an array of benefits through their Chinese joint partner including easier access to the Chinese market, faster acceleration of localization and the sharing of resources.
(1) It is much easier for Yahoo to access to the Chinese market through Chinese joint partner.
(2) Yahoo may have the opportunity to capitalize on the established reputation of their more experienced Chinese joint partner and may accelerate the process of localization.
(3) Yahoo may access to resources they may not have had in the past, such as specific skills Chinese joint partner brings to the table that they did not currently have in your own labor pool. For example: the skill about how to dealing with the Chinese government officer.
There are, however, a number of risks related to joint ventures that can result in loss of control, lower profits, and conflict with partners, including the following:
(1) Yahoo may not communicate their objectives clearly with their Chinese joint partner, resulting in misunderstanding. These communication issues can be exacerbated by geographic and cultural distance among partner firms.
(2) Yahoo and Beijing Founder Electronics may have distinct corporate cultures and management styles, resulting in poor integration and cooperation
(3) Source of conflict may be that the JV disproportionately allocates resources among the firms. For example, Yahoo may find that its technology is being appropriated by Beijing Founder Electronics.
How does a strategic alliance differ from a joint venture? Explain the pluses and minuses of such alliances?
The joint venture is a legal relationship between the businesses often forming a new business, while Strategic Alliance is mutual coordination of strategic planning and management and combining of resources or information in order to achieve long term objectives between two organizations. Under this, each organization will work independently and no separate entity is formed. It is not legally binding. Strategic Alliance is considered as less risky due to less legality.
The pluses of strategic alliance include three major points.
The risk can be shared by both parties.
Both parties have the opportunities to access to the new market and technology.
The government barriers can be overcome easier by the helping of respective party.
The minuses of strategic alliance also include three major points.
The technology and information leakage between two parties.
The possible opportunistic behaviors of partners
The increasing cost between two parties including searching costs, monitoring costs, and coordination costs.
The strategy Brandon used can be described as "fight a quick battle to force a quick decision". Because the huge difference between American culture and Japanese culture, Brandon think Mr. Kumatsu spend more than enough time exchanging information in the negotiation process, for Brandon, standards of cooperation and assertiveness are not the same as for the Japanese.
However, Mr. Kumatsu does not think that Brandon's maximum cooperative effort is sufficient when compared to his own acceptable level of cooperation. It seemed that the Mr. Kumatsu interpret Brandon assertiveness as aggressiveness, since an American's standard of assertiveness is stronger than what the Japanese consider reasonable, which must lead to a failure of this deal.
(2) Design an effective management strategy for Brandon to successfully achieve s good international dealings with their company's suppliers in Japan.
Firstly, this effective strategy should be based on the long-term goal. American CEOs always try to improve and maximize their companies' profits in their limited time frame of contract terms with a company rather than considering long-term cooperation as success. In contrast with American CEOs, Japanese CEOs see companies as eternal structures, and consider themselves as history-makers for companies. This does not mean that the Japanese do not care about making immediate or short-term time profits. However, they see current profits as a long-term benefit rather than in a one-time-only benefit (Adachi, 2010).
Secondly, enough prepared negotiation time should also be involved in this effective strategy. Japanese decision-making is very different from western countries. The slow decision-making is not an unwillingness to take risks, but a necessity that the decisions have to be based on a consensus of all persons involved, all these persons involved in a team or in the negotiation process must get the trust of the leader (Alexis et al., 2000).
Last but not least, some little details also should be focused in the negotiation process. For example, Brandon should use roundabout phrases and softened statements instead of stating views directly. Brandon should received business cards with both hands while bowing slightly to show his respect to Japanese culture. The giving of gifts on first meeting can also be taken. Social talks about families, hobbies, and common interests to the Japanese partner are also acceptable.