When a company is conducting business internationally, understanding the culture of the country or region, it is doing business with, as well as making sure the business fits the culture where it is doing business, is extremely important. Not understanding the culture could mean that the product or service affects the competitiveness, marketing, and could even have some political ramifications. An understanding of the country’s language, attitudes and beliefs, religion, material culture, social education, legal characteristics, and political structures can have a positive impact on the success of an overseas business venture. In order to run a successful international business, a business manager must also become a student of culture and …show more content…
Developing a marketing strategy with a clear understanding of the country’s attitudes and beliefs, will determine if the product or service will be well received or offensive. Culture is learned, not inherited by people. A culture consists of groups of people who exist in a society of shared values and ideas. Using the same marketing strategy in two different cultures whose beliefs are quite different from one another, can be a huge mistake. An illustration of this is using an owl as a symbol in advertising a product. In the United States, we perceive the owl as a symbol of wisdom, making it a successful marketing strategy, as it was for the Tootsie Pop. However, in India, the owl is perceived as a bad luck symbol. If a company were to use that same owl to advertise for the Tootsie Pop in India, the company would not likely sell many Tootsie Pops. The people of India are more than likely to be offended by the use of an owl in the advertising or perceive the product to bring them bad luck by …show more content…
Doing business in a country where the political policies are at odds with the United States could cause a company to lose its business on the home front. People who strongly oppose or disagree with the country’s policies could cause them to boycott or protest the company’s product or service. For example, getting involved with a country who has been accused of human rights abuse, may cause bad publicity by association. There are also political risks to consider, such as, war, revolution, terrorism, and labor strikes, all of which could impact the success of an international company. Companies need to carefully monitor and plan for political risk that may arise from doing business in a foreign country. Being able to speak the local language when a company is setting up a business in a foreign country is important for several reasons, the first being communication. Being able to negotiate deals and understand the details first hand, without interpretation, is important in negotiating the best terms for both parties. Having firsthand knowledge of the language and the culture will help to make both acquisitions and a new startup go more smoothly and quickly (Barrow,
Societies have different cultures and people in each culture are grown and raised with a set of norms, values, and beliefs. These shared values and beliefs are learned from their childhood through their adulthood. Culture is not something which everyone is born with, but it is something which everyone learns while growing up. It does not only influence the daily lives, but it also influences the business activities which take place in that particular society. Many of us work with people who have different backgrounds and that makes it important for us to understand the differences between cultures. So, although cultures might look similar, there are differences in many aspects which distinguish them from each other. There are five cultural
Thesis: The church is catholic or universal through inculturation and different interpretations of Christianity in many different cultures. In order for the church to be catholic, it must be able to spread the Gospel with respect of the cultural diversities.
Doing business with various multicultural companies it is easy to stop barriers between people and the business partners. In the source, the author points the cultural competence differently from professional in general and conducts of a new code that developed to remove the cultural system. By creating business with different culture, people one thing we know that is “culture” about the new nation and religious norms of that country. While working with different cultured people we also gain vast knowledge about caste, customs and much more. For example- people of Canadian’s are too friendly and helpful to talk and interact with the peoples of other countries and help them to settle down in their country by providing them knowledge about the customs of their country . By giving respect to another nation, people they feel a family relation to their business colleagues and partners. Thus, this brings a good relationship among peoples of different communities’ languages and help to create a strong bond between two countries and two
The authors identify that there are three main factors that effect how people act, think, and make decisions. The first is religion, in some countries faith plays an important role in all areas of life in the culture of the country and can influence many of their customs and behavior. The second factor is that of fact. In many countries their greatest desire is to find the best deal and the best product or services. The final factor is feeling, if a culture is based on feelings the people will conduct business accordingly. For example it would be essential to make a personal connection with this type of individual.
Steve Kafka, an American of Czech origin and a franchisor for Chicago Style Pizza, has decided to expand his business into the Czech Republic. He knows it is a risky decision; when he became a franchisor, he had to overcome a lot of difficulties. Steve anticipates he will face some of these difficulties again at the new location in Prague, Czech Republic. Although he was born in the United States, he has family and friends in the Czech Republic, speaks Czech fluently, and has visited the country of his origin several times. He knows the people and the culture. In this paper, I will analyze the cross-cultural differences between the United States and Czech Republic, determine comparative advantages in this country, and recommend ways to minimize the risks of establishing a franchise overseas.
Our economic development will forever be defined as our ability to succeed internationally. PwC forecasts India’s real annual GDP growth until 2050 at 8.9 percent, Vietnam’s at 8.8 percent, and China’s at 5.9 percent. The list of fast-growing emerging markets goes on and on. The U.S. forecast is a meager 2.4 percent, comparable with most Western economies. The domestic companies that are likely to see incremental growth in the coming decades are those that are not only doing business internationally, but that are developing the strategic skill set to master doing business across cultures. Cross-cultural core competence is at the crux of today’s sustainable competitive advantage. For example, political environment will tell us, as to how and why political leaders control, whether and how of international business. Legal environment, both national and international will tell us about many kinds of laws by which business firms must work. The cultural environment will tell us about attitudes, beliefs and opinions important to business people. Economic environment will tell us about the economic system being followed by the host country, which may or may not be different from home country. It will also explain the variables such as level of development, human resources, Gross Domestic Per Capita and consumption patterns that determine a firm’s ability to do business. Geography will tell us about location, quantity, and quality of the world’s resources.
As companies grow and put heavier weight on the importance of globalization, the need for companies to partake in cultural learning becomes more and more vital. With the various cultures worldwide, companies will find it highly beneficial to not only learn what makes the people within these cultures tick, but more importantly, apply it to their business strategies. In order to successfully manage, merge, or trade with other countries, one must understand how cultures differ from each other and what steps they need to take to be successful when conducting business with these cultures. The use of cultural anthropologists has proven beneficial for companies like Google, Intel, and Microsoft in implementing their business
Finding the balance between standardisation and localisation is one of the towering problems that companies encounter when tapping international markets. So many times companies choose to standardise their marketing mix for international markets, either for cost efficiency reasons or the lack of reasonable global marketing strategy. (Singh, 2016)
As a result, culture plays a vital role in expanding international business with its impacts from general strategic direction to details like logo.
There are three main political risks that can be encountered when moving business overseas which are: confiscation, expropriation, and domestication. Each of these risks can have significant adverse effects on a company that is trying to expand into foreign countries. Of the three, confiscation is considered to be the most severe political
THE POLITICAL ENVIRONMENT: The critical concern Political environment has a very important impact on every business operation no matter what its size, its area of operation. Whether the company is domestic, national, international, large or small political factors of the country it is located in will have an impact on it. And the most crucial & unavoidable realities of international business are that both host and home governments are integral partners. Reflected in its policies and attitudes toward business are a governments idea of how best to promote the national interest, considering its own resources and political philosophy. A government control's and restricts a company's activities by encouraging and offering support or by discouraging and banning or restricting its activities depending on the government. Here steps in international law. International law recognizes the right of nations to grant or withhold permission to do business within its political boundaries and control its citizens when it comes to conducting business. Thus, political environment of countries is a critical concern for the international marketer and he should examine the salient features of political features of global markets they plan to enter. THE SOVEREIGNITY OF NATIONS From the international laws point of view a sovereign state is independent and free from external control; enjoys full legal equality; governs its own territory; selects its own political, social, economic systems; and has the power to enter into agreements with other nations. It is extension of national laws beyond a country's borders that much of the conflict in international business arises. Nations can and do abridge s...
Foreign language skills can be useful in promoting American foreign interests. In a global economy, doing business abroad is paramount, but language barriers can be a burden. Opponents of a foreign language requirement in education would argue that most foreign businessmen already speak English. Admittedly, most foreign competitors do speak English, but only out of necessity. They learned to speak English in an effort to better communicate with their American counterparts and take advantage of the money making potential of doing business in America.
With the rapid growth in globalization there are a number of firms who have taken their businesses abroad. Their challenge, cross cultural management and communication. An effective communication strategy begins first with understanding who the sender of the message is and who the receiver of the message is. Many companies have realized this and offer training in the different cultures to help better facilitate communication between leaders (Cross-Cultural Communication, mindtools.com). Without this basic understand between sender and receiver it can be very difficult for companies of multicultural to even begin to communicate. The second important understanding is that leaders must demand a cultural tolerance of acceptable behavior between cultures to facilitate effective communication (Cross-Cultural Communication, mindtools.com).
The differences in other cultures vary from beliefs to ways of life, or norms, of the different societies. The importance of understanding and sensitivity to other countries’ differences is crucial to a business’ success. “Lack of familiarity with the business practices, social customs, and etiquette of a country can weaken a co...
Miroshnik, V. (2002). Culture and international management: a review' The Journal of Management Development 21(7): 521-544