Management Assignment: Impact Of Globalisation On Business Organisations
The Questions to be answered in this management assignment are:
Question 1: What are two (2) examples of the means of internationalisation?
Question 2: In a Western cultural context, describe the essential individual characteristics or professional traits expected from managers? Provide at least five (5) examples in your response.
Question 3: Multi-national enterprises (MNEs) have been criticised for having a “cash-cow” perspective of their host country’s resources. Explain why this may be the case and provide examples in your response.
Question 4: As part of cultural leadership, there are four (4) important culture-based norms and beliefs which need to be considered. Explain each type of culture-based norms and beliefs and provide appropriate examples in your response.
Question 5: When engaging in cross-cultural communication, there are six (6) fundamental patterns of culture differences. Explain five (5) of them and provide appropriate examples in your response.
The concept of internationalisation explored in this management assignment relates to the procedure to design and develop goods and services for meeting the requirements of customers in different countries. Internationalisation is the emerging effect of globalisation. According to Kellermanns and Hoy, (2016, p.152), globalisation has enhanced the competition among the business organisations as more organisations are now expanding their business to other countries for increasing their consumer base and the market share. It has been also identified that due to globalisation the management of the organisations, products, and services has also been transformed. Among the different types of means of internationalisation, joint venture and franchise are two means that include maximum reward with the environment of minimum risk factors.
Joint Venture relates to the business arrangement wherein more than one organization make the agreement to pool their capabilities and resources to accomplish a particular business goal in the international market. Joint ventures allow businesses to create a new identity wherein both of the participating organizations take an active role to formulate business strategy and make business-related decisions. The major advantage of the Joint venture model of internationalization is the low risks, and opportunity to gain economies of scale and utilizing the advanced technology of the partner organizations (Rosado-Serrano et al., 2018, p.241). For example, Joint venture between Omega Navigation Enterprises Inc. and Topley Corporation is a successful example of Joint venture based internationalization. Franchising is another important means of internationalization for businesses in which an organization grants permission to other organizations to utilize its name and trademark for undertaking a business activity. The major benefit of internationalization based on franchising strategy is that the overseas expansion of businesses becomes less expensive and less risky. A successful example of international franchising is the international strategy of McDonald’s.
In the view of Jackson and Wilton, (2017, p.751), the role of a manager is to carry out functions such as organizing, planning, directing, controlling and staffing. It is evident that the functioning of the managers is highly dependent on the cultural forces and in the context of the western culture, the five examples of major essential individual characteristics and professional traits that are important for the managers are Organizing skills, commanding ability, communication skills, coordinating skill, forecasting and planning skill. Organization skills of the managers include functions such as prioritization of tasks, scheduling activities, and managing time for activities. Apart from the impact of the culture, the managerial traits are also highly influenced by the social and technological factors. The good commanding ability is another major personal trait of the managers which is expected in order to impart a vision to the organization for the achievement of the organizational goals. In western culture, managers are required to have a good command over the employees in the organization so that different activities are carried out in an effective and timely manner.
The western countries are becoming more diverse in nature and the organizations are also involving people from different cultural backgrounds for enhancing the productivity level (Yashkova et al., 2016, p.4652). Therefore, managers are expected to have effective communication skills so that they can communicate with people from different backgrounds. In western business culture, the managers are required to associate with different people outside the specific department which enhances the need for coordinating skills. The coordinating skill is a personal trait of the managers that help them to coordinate with multiple people at the same time so that the works are carried out on time. The changes in the economy and the social trends have a great influence on the needs as well as the behaviour of the consumers. In this aspect, the managers are expected to forecast the demand in the market in an appropriate manner and plan business strategies accordingly.
According to Robertson and Luiz, (2019, p.554), Cash-cow relates to one of the strategies among the four strategies included in the four quadrants of the Boston Consulting group’s product portfolio matrix (BCG matrix). The cash-cow aspect is generally implemented by organizations by placing products in the markets with a low growth rate but with a high market share. MNEs are sometimes criticized for utilizing the host countries’ resources as cash-cows. In this case, the cash cow relates to the metaphor to indicate that the host countries’ resources are utilized by the MNEs to enjoy a strong potential from a market that has a low growth rate. The reason behind the increasing criticism of the approach is that the MNEs do not have to invest much on the business when they implement a cash-cow perspective. According to Robertson and Luiz, (2019, p.56), once the MNEs can recover the initial investment in the market of the Host country, it would not require further investment for growing the business in the host country. For example, MNEs utilize the human resources of the host countries as a cash cow. In the host countries, the MNEs are likely to face huge problems from political issues. Moreover, it is identified that MNEs neglect the usage of the expertise of the host country managers to assess the political risk on the business. In this context, the cash cow perspective is applied by turning the question mark and star jobs into cash cows until they turn into the dogs and so that the company can liquidate them. Therefore, the particular strategy of the MNEs to implement the host countries’ resources as a cash-cow is worth criticizing.
Cultural play a critical role in business and leadership. Cultural norms and beliefs can be regarded as the sets of behaviours and perspectives shared by the members of society. To possess a strong cultural leadership ability it is important to follow the four categories of cultural norms and beliefs that are generally regarded by people and society. The latest four types of cultural norms and beliefs that are explained by the sociologists are Taboos, Folkways, Laws and Mores (Manning, 2017, p.5). Folkways as customs or conventions that relate to approved standards of behaviours that are not morally important. For example in Western culture, wearing formal attire in the environment of business is a folkway cultural norm and belief for the cultural leaders. Laws are the formal body of rules that are enacted by the government with political power.
It is evident that the existence of loss is to discourage specific behaviour that could typically result in harm or injury to other persons. For example, laws against the violations of intellectual property rights is an example of the norm law and the violation of the law can result in a sanction that can include a payable fine or imprisonment. Mores norms are much stricter than the folkways as this determines the ethical and moral behaviour by structuring the difference between the wrong and right. A cultural leader must have the knowledge regarding the most as a violation of mores can result in disapproval or ostracizing. For example, Religious doctrines can be explained as more norms and beliefs that govern the social behaviour of the cultural leaders in the context of business. A Taboo can be regarded as a negative as well as the strong norm which prohibits specific behaviours (Gur, 2017, p.188). The degree of the strength of the taboos is high that the violation can lead to expulsion from the society and extreme disgust. For example, saying negatively against people belonging to other religions or race is a taboo in some organizations.
Cross-cultural communication is an important aspect in international business and management of issues (Sheldon et al., 2017, p.646). From the emergence of globalisation the cross-cultural communication for the purpose of business has been significant. There are six fundamental patterns of cultural differences that are important when engaging in cross-cultural communication like different approaches in completing tasks, different attitudes toward conflicts, different attitudes towards disclosure, different decision-making styles, different communication styles, and different approaches to knowing.
Different approaches in completing tasks
The ways in which different tasks are completed varies from culture to culture. The reason behind the differences includes variation in access to different resources, different perception regarding the rivers linked with the completion of tasks and wearing ideas regarding time. For example, business negotiations are approved in a different way in Chinese culture and American culture.
Different attitudes toward conflicts
The reason behind the differences between conflict management approaches different culture stains from the perception regarding the conflict (Santos et al., 2016, p.119). For example, some cultures visualise conflict as a negative element whereas other cultures view it as a positive element.
Different attitudes towards disclosure
There is a distinct variation in attitudes towards disclosure of information among cultures. For example, in some cultures, people are not frank regarding the reveal of emotions, personal information and the reasons behind misunderstandings or conflict. Therefore, an appreciation of the patterns of cultural difference can help in effective cross-cultural communication.
Different decision-making styles
In the decision making styles of different cultures, there is a varying role of individuals. For instance, in American countries, greater priorities are placed to hold decision-making responsibility to a specific person while in Japan consensus is regarded as the preferred mode of decision making.
Different communication styles
It is evident that the way in which individuals communicate in different cultures varies widely. The usage of language is another major aspect of communication style however the usage of body language is one of the major aspects of communication style. For example, Americans have a very explicit communications style while Australians are more outward-looking, blunt and direct in relation to communication.
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Manning, P., 2017. Folkways as a Sociological Classic. In On Folkways and Mores (pp. 1-12). Routledge.
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