3,4.docx - Adaption not require executives to forsake their ways to change local customs but willing to accommodate those differences that cause

3,4.docx - Adaption not require executives to forsake their...

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Unformatted text preview: Adaption not require executives to forsake their ways to change local customs, but willing to accommodate those differences that cause misunderstandings 3 Business customs: Imperatives: customs must be recognized and accommodated (menh lenh), must be met and conformed to or avoided if relationships are to be successful Electives: customs to which adaption is helpful but not necessary Exclusives: customs in which outsiders must not participate _____ are the business customs and expectations that must be met and conformed to or avoided if relationships are to be successful. A. Cultural exclusives B. Business truism C. Global protocols D. Business axioms E. Cultural imperatives Which of the following would most likely be characterized as being an imperative business custom in many cultures? A. Establishing friendships Simon Peters, a senior manager at Celise Export Logistics, goes to France to negotiate a deal with the company's French partners. He dresses casually in a t-shirt and jeans. His French counterparts call off the meeting and accuse him of taking a casual attitude toward negotiations. In this scenario, dressing formally during business meetings is probably a cultural _____ for the French. A. imperati ve Business customs in which an outsider must not participate are called _____. A. imperativ es B. electiv es C. exclusiv es Betty Roberts became an embarrassment to her company when she joked about the ruling monarchy in England in front of a group of visiting English businesspeople. She should have known that political ridicule by a foreigner is rarely accepted. Ms. Roberts has violated what is known as a cultural _____. A. imperati ve B. electiv e C. exclusiv e Cross-cultural Perception: The stage in which each individual select stimuli (interesting) from the external environment Selective, learned, inaccurate, and culturally determined Cross-cultural communications is when a person from one culture sends a message to a person from another culture Environmentally sensitive products industrial products Cross cultural communication can causes misunderstanding: Misperception (select) Misinterpretation (organize) Misevaluation (evaluate) Cross-cultural Interpretation The stage in which an individual organize the observation in a meaningful way to guide behavior (attempts to give meaning to the observation and their relationships). smoke -------- fire cloudy -------- rain Ex: stereotyping Why do people categorize? To simplify their environments percept – select interesting from external invi communication – send message to person from another culture Interpretation – organize observation in a way – stereotyping What is natural process of stereotyping?: categorize Top-level management decision making is generally found in situations in which family or close ownership gives absolute control to owners and businesses are small enough to allow such centralized decision making. Decision-making participation by middle management tends to be deemphasized; dominant family members make decisions that tend to please the family members more than to increase productivity Low context - depends more on explicit, verbally expressed communications (noi thang), Pushy/ impatient/ ,business involved quickly, position of person not important, position of person not important, everything on paper, M-Time (monochromic)- used time linear way orientation High context - depends heavily on the contextual (who says it, when it is said, how it is said) or nonverbal aspects of communication. actual words may not carry, message are indirect or implicit, get into business slowly, position of the person is important, not much on paper, Ptime (completion of a human transaction is emphasized more than holding to schedules) Country of low context: swiss, german, north America Country of high context: Japan Bribery ( hoi lo truc tiep): voluntarily offered payment seeking unlawful advantage Extortion (tong tien): If payments are extracted under duress (bat buoc) of someone seeking lawfully entitled to Lubrication involves a relatively small sum of cash, a gift to lower ranking official not prohibited by the laws – do job quickly Subornation: involves giving a large sum of money desgined to entice an official to commit an illegal act – not do their job or break the law Agent fee: third part payments Alternating country – U.S; Silent period country: Japan; Overlapping country: Brazil Relationship-oriented culture: achieves efficiency through reduction of transaction cost Information-oriented culture: achieves efficiency through competition – low-context, has individualism, low power distance Chuong 6 Sovereignty: chu quyen: powers exercised by state (citizenship, geographical boundaries, controls trade and movement of people and goods) and the suprmeme power exercised over its own members Adherence to WTO inevitably means the loss of some degree of national sovereignty In the context of international law, a _____ state is independent and free from all external control. A. bounde d B. sovereig n Adherence to the WTO inevitably means: A. a definite increase in import tariffs worldwide. B. the loss of national security to a large extent. C. reduction in world trade by at least 70 percent. D. the loss of some degree of national sovereignty. political causes of instability in international markets: (1) some forms of government seem to be inherently unstable, (2) changes in political parties during elections can have major effects on trade conditions, (3) nationalism, (4) animosity targeted toward specific countries, and (5) trade disputes themselves. Pressure from nationalist (opposing party) and self-interest groups affect the stability of a government. Nationalism can best be described as an intense feeling of national pride and unity, an awakening of a nation's people to pride in their country. This pride can take an anti-foreign business bias, where minor harassment and controls of foreign investment are supported Expropriation and nationalization have often led to nationalized businesses that were inefficient, technologically weak, and noncompetitive in world markets. The most severe political risk is confiscation, that is, the seizing of a company's assets without payment. The ultimate goal of domestication is to force foreign investors to share more of the ownership, management, and profits with nationals than was the case before domestication political and social activists (PSAs) can also interrupt the normal flow of trade. can range from those who seek to bring about peaceful change to those who resort to violence and terrorism to effect change Planned domestication can be profitable and operationally expedient for the foreign investor MNCs (1) improves the balance of payments by increasing exports or reducing imports through import substitution; (2) uses locally produced resources; (3) transfers capital, technology, and/or skills; (4) creates jobs; and/or (5) makes tax contributions. The Department of Commerce (DOC) is the principal agency that supports U.S. business abroad. The International Trade Administration (ITA), a bureau of the DOC, is dedicated to helping U.S. businesses compete in the global a sovereign state is independent and free from all external control; enjoys full legal equality with other states; governs its own territory; selects its own political, economic, and social systems; and has the power to enter into agreements with other nations. G20 nations agree to ceded some sovereignty Monarchy, like dictatorship, is a form of government ruled by one. aristocracy (or oligarchy) rule by few democracy rule by many Forms of government in use today are monarchy (or dictatorship), aristocracy (or oligarchy), and democracy nationalism are manifested in a variety of ways, including a call to "buy our country's products only" (e.g., "Buy American"), restrictions on imports, restrictive tariffs, and other barriers to trade. Domestication occurs when host countries gradually cause the transfer of foreign investments to national control and ownership through a series of government decrees that mandate local ownership and greater national involvement in a company's management. Exchange controls stem from shortages of foreign exchange held by a country. Local-content laws any product sold within the country to have local content, that is, to contain locally made parts Political risks – Taxes To lessen political risk: joint venture, expanding investment base, political bargaining Price control - Essential products that command considerable public interest, such as pharmaceuticals, food, gasoline, and cars Boycotting: Stopping or refusing to trade with another nation for political reasons political and social activists (PSAs) can also interrupt the normal flow of trade. PSAs can range from those who seek to bring about peaceful change to those who resort to violence and terrorism to effect change nongovernmental organizations (NGOs) are increasingly affecting policy decisions made by governments. Many are involved in peaceful protests, lobbying, and even collaborations with governmental organizations Export-Import Bank (Ex-Im Bank) underwrites trade and investments for U.S. firms Political risk assessment is an attempt to forecast political instability to help management identify and evaluate political events and their potential influence on current and future international business decisions. Reduce political harassment (nationalism) – Joint venture Minimize political vulnerability and risk - Licensing Juliet is concerned with the potential for political harassment when her company enters a new international market. To reduce the risk of political harassment, she is most likely to consider using _____ to enter the market. A. externally produced products B. a smaller investment base C. foreign technology D. joint ventures planned domestication - solution to a situation where a foreign government is demanding local participation in a multinational corporation's business activities in the host country political payoff—an attempt to lessen political risks by paying those in power to intervene on behalf of the multinational company. Bribery poses problems for the marketer at home and abroad, because it is illegal for U.S. Agencies is dedicated to helping U.S. business compete in a global marketplace - The International Trade Administration (ITA), a bureau of the DOC Confiscation is the seizing of a company's assets without payment. Expropriation occurs when the government seizes an investment but some reimbursement for the assets is made. Domestication occurs when the host country gradually causes the transfer of foreign investments to national control and ownership through a series of government decrees by mandating local ownership and greater national involvement in a company's management CHAP 7 No single, uniform international commercial law governing foreign business transactions exists International marketers must comply with the laws of each country within which it operate Common law, derived from English law and found in England, the United States, Canada, and other countries once under English influence The basis for code or common law is tradition, past practices, and legal precedents set by the courts through interpretations of statutes, legal legislation, and past rulings. Common law seeks “interpretation through the past decisions of higher courts which interpret the same statutes or apply established and customary principles of law to a similar set of facts.” Civil or code law, derived from Roman law and found in Germany, Japan, France, and in non-Islamic and non-Marxist countries Not all inclusive Ownership: by use (car accident vidu) Agreement biding by proof of agreement established Acts of God limited to acts of nature, riot or strikes not allowed Code law is based on an all-inclusive system of written rules (codes) of law. Considered complete catchall provisions (law intended to cover all possibilities) Ownership (by registration) Agreement biding properly notarized or registered impossibility of performance does not excuse for non-compliance, unless Acts of God, except commercial law Islamic law, derived from the interpretation of the Koran and found in Pakistan, Iran, Saudi Arabia, and other Islamic states includes issues such as property rights, economic decision making, and types of economic freedom overriding objective of the Islamic system is social justice prohibits the payment of interest or “riba” describes specific patterns of social and economic behavior for all individuals Commercial Law in Marxist Economies - Marxist–socialist economies of Russia and the republics of the former Soviet Union, Eastern Europe, China, and other Marxist–socialist states each country moves toward its own version of a free market system and enters the global market As socialist countries become more directly involved in trade with non-Marxist countries, it has been necessary to develop a commercial legal system that permits them to engage in active international commerce. EX: CHina Jurisdiction in International: Determining whose legal system has jurisdiction when a commercial dispute arises The World Court at The Hague and the International Court of Justice: resolve international disputes between sovereign nations 1. three situations: between governments, gg 2. between a company and a government, gc 3. and between two companies cc The World Court adjudicate 1.; Not 2. and 3.; 2 and 3 through arbitration Jurisdiction is generally determined in one of three ways, on the basis of: 1. jurisdictional clauses included in contracts 2. where a contract was entered into 3. where the provisions of the contract were performed Conciliation or mediation is a non-binding agreement between parties to resolve disputes by asking a third party to mediate differences. Discussion between parties and mediator are confidential (bao mat) Arbitration is Parties select a disinterested and informed party as a referee to determine the merits of the case and make a judgment both parties agree to honor. Ex: Inter-American Commercial Arbitration Commission (21 Western Countries & U.S.) London Court of Arbitration(decisions enforceable in English Law and English Courts) American Arbitration Association (Mostly relating to U.S. activities but expanding to China) AAA International Chamber of Commerce ( most successful. 90% upheld in courts) ICC Litigation is the last resort and not a preferred option in most disputes, especially in countries where it considered public humiliation Fear of creating a poor image Fear of unfair treatment in a foreign court Difficulty in collecting a judgment Cost and time Loss of confidentiality Protection of Intellectual Property: Counterfeiting and Piracy - leads to lost sales from the unauthorized use of U.S. patents, trademarks be between $225 to 600 billion annually as well as lost jobs. Counterfeited pharmaceutical drugs can also lead death and bad publicity Inadequate Protection - many countries do not recognize trademarks and patents registered in other countries Prior Use vs. Registration: In the United States, a common-law country, ownership of intellectual property rights is established by prior use In many code-law countries, ownership is established by registration rather than by prior use International Conventions: for mutual recognition and protection of intellectual property rights - The Paris Convention for the Protection of Industrial Property - The Inter-American Convention - The Madrid Arrangement Cyberlaw: Unresolved Issues Cybersquatting: The practice of registering a domain name that is the trademark of another person or company Cybersquatters register a well-known brand or trademark that misdirects a person to the CSQ’s site or to a competing company’s site Two of the most troubling areas are • determining whose laws will prevail in legal disputes between parties located in different countries • establishing the contractual validity of electronic communications U.S. Laws Apply in Host Countries Leaving the boundaries of a home country does not exempt a business from home-country laws What is illegal for an American business at home can also be illegal by U.S. law in foreign jurisdictions for the firm, its subsidiaries, and licensees of U.S. technology Foreign Corrupt Practice Act (FCPA): cant pay bribe, stiff penalties National Security Laws: ko ban technology cho nuoc co the gay hai cho U.S AntiTrust laws: protect consumer from restrict competitions protect export and investment against privately restriction A culture that is low context, individualistic, has a low power distance, and uses monochronic time is _____. A. informationoriented A culture that is high context, has collectivism, has a high power distance, and uses polychronic time is _____. A. informationoriented B. relationshiporiented Subornation generally involves giving large sums of money— frequently not properly accounted for—designed to entice an official to commit an illegal act on behalf of the one offering the bribe. extortion if payments are extracted under duress by someone in authority from a person seeking only what he or she is lawfully entitled to. Lubrication involves a relatively small sum of cash, a gift, or a service given to a low-ranking official in a country where such offerings are not prohibited by law. The purpose of such a gift is to facilitate or expedite the normal, lawful performance of a duty by that official. According to studies conducted by Transparency International, higher levels of bribery have been found in low-income nations and nations with a communist past, both aspects of the political economy. Additionally, higher levels of bribery have been found in collectivistic (IDV) and high power distance (PDI) countries The P-time system gives rise to looser time schedules, deeper involvement with individuals, and a wait-and-see-what-develops attitude In some code-law countries, certain agreements may not be enforceable unless properly notarized or registered; in a common-law country, the same agreement may be binding so long as proof of the agreement can be established. 31. Which of the following is true of culture? A. It is a set of texts considered to be sacred. B. It is a society's accepted basis for responding to external and internal events. C. It is a branch of philosophy dealing with beauty and taste. D. It is the philosophical study of being and knowing. E. It is a set of written rules governing socially acceptable behavior. Culture can be defined as a society's accepted basis for responding to external and internal events. To interpret behavior and attitudes in a particular culture or country, a marketer must have some idea of a country's history and geography. AACSB: Analytical Thinking Accessibility: Keyboard Navigation Blooms: Remember Cateora - Chapter 03 #31 Difficulty Level: 1 Easy Learning Objective: 03-01 The importance of history and geography in understanding international markets Topic: Historical Perspective in Global Business 32. In 1066, William the Conqueror defeated Harold II in the Battle of Hastings, establishing Norman rule in _____. A. Braz il B. Chin a C. Englan d D. Japa n E. Franc e In 1066, William the Conqueror is victorious over Harold II in the Battle of Hastings, establishing Norman rule in England and forever linking the country with the continent. AACSB: Analytical Thinking Accessibility: Keyboard Navigation Blooms: Remember Cateora - Chapter 03 #32 Difficulty Level: 1 Easy Learning Objective: 03-02 The effects of history on a countrys culture Topic: Historical Perspective in Global Business 33. The _____ was a political protest against the British prohibition of Yankee traders from dealing directly with merchants in Canton. A. Hong Kong Revolution B. Boston Tea Party C. Taiping Rebellion D. First Opium War E. Canton Uprising In a sense, American history really begins with China. Recall t...
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