An International Business Issue Discussed

Overview

Doing business over borders and through time zones has become commonplace in the twenty-first century. International firms are consistently examined by the cultural differences between countries when they expand their products or services into foreign markets, and seek the most productive and talented employees of the world out. Culture, being intangible in shape, builds up of a particular society's behaviors, from religion beliefs to dressing style to art to methods of farming. Trompenaars and Hampden-Turner consider that culture is a shared belief of a group of people. Also, according to Mahoney, Trigg, Griffin and Pustay, culture is the set of values, attitudes, beliefs, behaviors and customs that distinguish a society. Besides, in the context of international management, culture is defined as "everything that people have, think, and do as members of their society Culture reflects social rules however it might be defined, while business must be conducted within the context of the society, a society culture thereafter guides the firms how to run in such society. Understanding culture constituents might help companies visualize the effects on conducting business. The reasons why understanding culture is important in doing international business will be discussed associated with examples. In further response to this question I will subdivide benefits from appreciation of culture as marketing products, managing workforces, and dealing with host country governments. Finally, the paper will conclude that doing business with multiple cultures can be a challenging venture; only those being well prepared for importance of understanding culture might eventually success. (Day 63-79)

Culture Issue In International Business

Technological advancements in communication and reductions in transport costs make it necessary to do business in a cross-cultural environment. Doing business with multiple cultures can be a challenging venture for companies who try to market abroad. Therefore, only those who understand the importance of the role of culture in international business activities can remain competitive advantages. Whereas, many notable companies including Nike, Ford, IBM, Hewlett-Packard etc. once failed on the way of their expansion in foreign markets. As well known, Nike is a notable sport brand that rules the athletic shoe market throughout the world's range. It once spent US$200 million to sponsor Brazil's national soccer federation and took the Brazilian team on an annual five-game global tour. Brazilians however saw Nike's "money will get you everything" strategy that is succeed in USA offending their passion and history, Nike thereafter was filed a lawsuit alleging that Nike was forcing the country's national team to play unnecessary exhibition games. Nike once produced a television commercial features Satan and his demons playing soccer against a team of Nike endorsers. The advertising was a big hit in Nike's home turf, but some European nations refused to broadcast it because they thought scenes were too scary and offensive to children. (1) Nike has a well-deserved reputation for producing controversial advertisements. Recently, it adverts featuring basketball star LeBron James slaying a Chinese dragon and a kung fu master. This ad has been banned in China and met with a flurry of criticism in Singapore. (James 91)

(2) Dragon, generally as a symbol of Chinese culture, and kung fu master, as a symbol of national pride, being defeat by American basketball, a symbol of American culture, are difficult to accept by most Chinese people. This is another typical failure sneaker giant suffered in foreign market due to ignorance of local society culture. Correspondingly, understanding importance of culture is a key factor if companies wish succeed in conducting international business. Generally speaking, understanding culture is able to benefit international business people in marketing products, managing workforces, and dealing with host country governments.

Marketing Products

Multinational Enterprises (MNEs) almost always attempt to sell their products and services into foreign markets so as to reach business most productive. Successfully doing business with international clients not only requires mastering international business rules and regulations, but also being similar with local society culture and regional etiquette. Any ignorance for customer's culture might cause misunderstanding, awkwardness, reverse and even business failure. As Ricks said cultural differences are the most significant and troublesome variables... the failure of managers to fully comprehend these disparities has led to most international business blunders. At the meantime, a successful foreign marketing strategy in one country often does not have