Cross Cultural Management of ANZ to Enter Brazil and Kenya
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Hi everyone, today we are going to present the business report conducted by our group. It is about the cross cultural management of ANZ to enter Brazil and Kengya.
The presentation is going to include the following parts. The first is introduction. The second is the cultural analysis of Hofstede's cultural dimensions, which includes Power distance, Individualism/collectivism, Masculinity/Feminity, Uncertainty avoidance, and Short-term versus long-term orientation. The third is recommendations on adaptations in Brazil and Kenya, which includes PEST Analysis of Brazil and PEST Analysis of Kenya. Then is conclusion and references.
The target company is Australia & New Zealand Banking Group Limited (ANZ). It is one of the most important commercial banks in Australia, with a development history of more than 180 years. It has subsidiaries in over 34 countries and regions in Asia, Pacific, Europe, America and the Middle East. The products and services include financing products, transaction services, investing, risk management, international services, insurance and superannuation. The principal protocol is the compliance with anti-money laundering and counter-terrorism financing laws and local regulations.
Mr Geert Hofstede developed the model of five cultural dimensions to analyze cultural values. Here is the comparison table of the home country and host countries based on statistics on the website of Geert Hofstede.
The PDI for Australia is relatively low and the PDI for Brazil and Kenya is high. As for management of ANZ, centralization is not good because it operates with financial affairs and is subject to regulations and risks of crimes. It is better to create an equal stage and a transparent, direct, and communicative atmosphere.
The IDV in Australia is as high as 90 and in contrast, the IDV for Brazil and Kenya are both low. The two countries are collective societies, and put focus on the concept of group and loyalty, requiring strong relationship and reliance.
Australia and Kenya are similar since they present more masculine characteristics. People have strong motive to win and would strive to be the best. Brazil, on the other hand, scores 49, which means that it is in a intermediate status. People in Brazil can both be ambitious and be tender.
Australia and Kenya are both intermediate. Brazil has a high score, since it is likely to be conservative and afraid of risks. So the subsidiary in Kenya there should consider creative promotion strategies and offer different experiences, and the subsidiary in Brazil should tend to keep things in the original way and avoid making too many changes.
Australia is a normative society that has respect for time-honored traditions and little concern for the future. Brazil is intermediate. In other words, the management of ANZ in the subsidiary in Brazil needs to take account of the possibility of changes and methods to solve practical problems.
In this part, we are going to make a few recommendations on what adaptations ANZ should take in cross-cultural management in Brazil and Kenya. Since the background factors of the two countries differ from the home country and influence the business outcome, it is necessary to carry out the PEST analysis to make proper adaptation suggestions.
In the political aspect, Brazil has a stable political and legal environment. There shows no risks of war or any other signs of social instability. The laws and regulations in the country have not set up trade barriers for foreign investors. Therefore ANZ would not face many political difficulties in doing business in Brazil.
Brazil is the largest economic entity in the Latin America area. This means that Brazilian customers have great buying power and would welcome financial products to make investment.
Brazil has its own unique system of laws, culture and traditions. ANZ needs to get familiar with its understanding of the cultural atmosphere to avoid difficulties or offences in communication.
The technological situations in Brazil is also positive. ANZ should incorporate the spirit of creation and the habit to honor traditions in the cross cultural management, in order to bring out the best of its employees.
Then is the PEST analysis of Kenya. Kenya is exposed to certain risks of social instability. The crime rate is quite high and there have been several resolutions and chaos. So ANZ should carefully choose the location of the bank.
In the economic aspect, Kenya has promising economic status and good investment environment. ANZ as a commercial bank may catch the opportunity of the factories and farmers.It should analyze the business models and design suitable financing plans.
Kenya is greatly different from Australia in the race, religion and social values. There is huge disparity between rich and poor and the hierarchy is strictly obeyed. Therefore for ANZ to do business in Kenya, it should conduct a survey about local customers' beliefs and compare whether these values go in conflict with its business. It should cultivate and encourage the employees to open up their mind.
Kenya is a developing country and falls behind the main stream in the development of technology. ANZ may consider target the companies that have interest in technology research and creation. It should provide loans and preference policies for investment in technology. This would give it advantage over other competitors.
In conclusion, the cultural dimensions between the home country Australia and the host countries Brazil and Kenya are similar in some index and different in others. The cultural adaptations should be made in consideration of the background factors relevant. It is necessary to have a general understanding of the country's culture and behavioral characteristics. And then ANZ should encourage the positive dimensions such as democratic management styles, authority of decision making, creative thoughts, ambition for success, performance based promotion system. It also should provide the most suitable products and services for local customers.
This is all of our report presentation. Thank you all for listening.
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