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globalization and multinational corporations
how multinational companies influence culture
cross cultural differences in business
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Recommended: globalization and multinational corporations
A multinational corporation is an entity that its headquarters is based in one country and incorporates a group of organizations that are geographically distant and have various goals. "Such an entity can be conceptualized as an inter-organizational network that is embedded in an external network consisting of all other organizations such as managers, customers, suppliers and regulators"(Ghoshal & Barlett, 1990). As the organizations develop and find their way into significant growth they are inclined to identify the goals, perspectives, assimilation, and rules of their framework. The role of the managers in such entities is to coordinate organizations that work in various cultures and environments, in which the levels of involvement, diversity, …show more content…
While the way of doing business may be similar everywhere in the world, cultural differences can have a significant impact on how these organizations operate. Local cultures can disorient a newly appointed expat manager and can lead to culture shock (s.,2011). Culture shock can be caused due to difference in ethics, ideology, execution and values between a manager 's native country and the local culture. Although culture shock can be disruptive to the manager 's performance, it can be defeated using a set of techniques and mechanisms. The manager has to understand and embrace the new culture and accept the differences it may have with his own. He should observe how people deal in the new culture and mimic the basic ways of dealings and conversing. Also, he should create a comfort zone where he can meet new people and practice his hobbies and interests with from time to time. Furthermore, it is useful to use stress reduction mechanisms to help him blend in to the new society …show more content…
Albeit in the same continent and the close proximity, German and French managerial styles have their differences. "In Germany there is a clear chain of command in each department, and information and instructions are passed down from the top. Managers work long hours, obey the rules and, though expecting immediate obedience, insist on fair play. For their part, German employees welcome close instruction: they know where they stand and what they are expected to do" (Sarosi,2016). Meanwhile in France the "style is more autocratic, though this is not always evident at first glance. In France, the boss seems to have a more roving role than his focused German counterpart, and often appears to consult with middle managers, technical staff and workers – but decisions are generally made by the chief executive and orders are top-down. The role and status of the leader in France is revealed by a glance at French history. Napoleon and Petain, for example, are remembered for their heroics rather than their failures. Ultimate success is less important than the thrill of the chase and the ability to quicken the national pulse. Hence, unlike elsewhere, there is a high tolerance in French companies of management blunders"
In the book Culture Shock! A Survival Guide to Customs and Etiquette, the authors define what it means to be Italian and key in on details that can transform you into a pro of the Italian culture. Similar to past readings, the Italian family really defines the true nature of its people. As the author says, “The Italian family was (and to some extent still is) very close-knit, spending the weekends together and often eating its meals collectively” (39). Italian-Americans continued this trend here in the states and it has been instilled in people like me to always prioritize your family.
Rajasekar, James, and Franck Renand. "Culture Shock in a Global World: Factors Affecting Culture Shock Experienced by Expatriates in Oman and Omani Expatriates Abroad."International Journal of Business & Management. Canadian Center of Science & Education, 1 Feb. 2010. Web. 5 Mar. 2014.
Multinational corporation operating through regional subsidiaries to minimize cultural differences in more than 60 countries
Culture shock is our psychological reaction to an unfamiliar or alien environment, which often occurs during a major transitional experience. Oberg (1958) referred to culture shock as “a generalized trauma one experiences in a new and different culture because of having to learn and cope with a vast array of cultural cues and expectations, while discovering that your old ones probably do not fit or work.”
Globalisation allows individuals, groups, corporations, and countries to reach around the world farther, faster, more deeply, and more cheaply than ever before. Most large local companies regard globalisation as opportunity, thereby exploring overseas markets for maximum market share and optimum business strategies. However, managers would face a series of challenges caused by leadership models, cultural backgrounds, political and economic risks, HR management, etc. To study multinational management skills is very useful for my future career. In this essay, I will set goals for this subject, identify the skills I have honed and need to improve, and explain my strategies for achieving goals.
According to Dutton’s (2011) implication, culture shock is a broadly tested model of expatriates react under a brand-new cultural condition. He pointed the birth of Oberg’s Four Stages Model explicitly illustrates the expatriates’ “honeymoon stage” to “adaptation stage”.
Multinational enterprises date back to the era of merchant-adventurers, when the Dutch East India Company and the Massachusetts Bay Company traversed the world to extract resources and agricultural products from colonies (Gilpin 278-79). While contemporary multinational corporations (MNCs) do not command the armies and territories their colonial counterparts did, they are nevertheless highly influential actors in today’s increasingly globalized world.
Cross-cultural and language training prior to departure featured high on the respondents ' list of actions a company could take to assist their adjustment on arrival in the new environment and their on-the-job effectiveness. This feeling of utter confusion and helplessness experienced by the expatriate illustrates how a simple investment in improving an understanding of the culture through specialist country-specific training could make the difference between a successful, profitable overseas assignment and an ineffective, long term struggle.
Therefore managers working abroad face a range of experiences related to culture and organizational goals. Hence they need to be well equipped mentally and emotionally for the novel experiences along with the preparation in the technological arena which is the back bone of international trade.
Thomas, D. C., and Ravlin, E. C.,1995. Responses of employees to cultural adaptation by a foreign manager. Journal of Applied Psychology, 80(1),pp.133–146.
Mira Wilkins defines a multinational enterprise (MNE) as a “firm that extends itself over borders to do business outside its headquarters country.” By 1870, a period denoted as industrial capitalism, MNCs started to evolve and the nature...
Expanding the organization across the geographical borders is a challenging task for managers (Yaprak, Shichun &Cavusgil, 2011). Expanding to the global market challenges manager capability to handle the international operations effectively and efficiently. Managers required coordinating multiple international teams from several different locations around the global. Essentially, managers need to balance the business operation with market expectations upon the domestic customer demand. An organization must acquire unique resources that create value for customers and gain the position of competitive advantage.
A multinational corporation or worldwide enterprise [1] is an organization that owns or controls production of goods or services in one or more countries other than their home country. [2] It can also be referred as an international corporation, a "transnational corporation", or a stateless corporation. [3]
Multinational enterprise (MNE) is “a company that is headquartered in one country but has operations in one or more other countries” (Rugman and Collinson 2012, p.38) that has at least one office in different countries but centralised home office. These offices coordinate global management in the context of international business. MNEs have increasingly essential influence on the development of the global economy and coordinate with other companies in different business environments. However, there are many issues involved with how MNEs operate well overseas, especially in emerging markets (EMs) (Cavusgil et al., 2013, p.5).
Nowadays, business is set in a global environment. Companies not only regard their locations or primary market bases, but also consider the rest of the world. In this context, more and more companies start to run multinational business in various parts of the world. In this essay, companies which run multinational business are to be characterized as multinational companies'. By following the globalization campaign, multinational companies' supply chains can be enriched, high costs work force can be transformed and potential markets can be expanded. Consequentially, competitive advantages of companies can be strengthened in a global market. Otherwise, some problems are met in the changed environments in foreign countries at the same time. The changed environments can be divided into four main aspects, namely, cultural environment, legal environment, economic environment and political system problems. All the changed environments make problems to multinational companies. In particular, problems which are caused by changed culture environment are the most serious aspect of running a multinational business. This essay will discuss these problems and give some suggestions to solve them.