International Business - Essay Example

? International Business Table of Contents EXECUTIVE SUMMARY 3 INTRODUCTION 4 RESEARCH 4 FINDINGS ANALYSIS 6 RECOMMENDATIONS & CONCLUSIONS 15 15 POST REPORT REFLECTION 16 BIBLIOGRAPHY 17 International Business To, The Expatriate Manager Orientation EXECUTIVE SUMMARY This orientation essentially revolves around introducing United Kingdom and its business culture to you as it is your first visit to this country. United Kingdom is a country with rich traditions and culture along with the influence of modernization. The business environment of UK is unique with respect to several aspects. There are certain established norms which are supposed to be followed in the British culture such as dress code, conversation mannerisms, dining etiquettes along with conduct related to titles and gift giving. In the field of business, you are required to exhibit judicious and ethical traits in order to win the confidence of the ever observant British businessmen. With globalization affecting the entire world, business strategies in UK have also transformed to yield innovation in markets as the key success indicator. As a result, you need to be very vigilant of the commercial atmosphere to facilitate growth in our subsidiary. I would advice you to understand the British culture scrupulously as well as develop the valuable tool of Cultural Intelligence. I am convinced that awareness of these dynamics will help you in having a prosperous three year contract in UK. INTRODUCTION As the regional manager for United Kingdom, I cordially welcome you to the local subsidiary of our Multinational Organisation. I am conscious of the fact that you are coming to United Kingdom for the first time; hence, I have made an attempt to facilitate your 3 year stay in this country by briefing you about the cultural nuances which you would come across in United Kingdom. Along with that, this paper would also enhance your understanding about the business environment of UK in addition to government policies with regard to subsidiaries and Multinational Corporations. You must be aware that this subsidiary of our company has been active in London, the capital of UK for quite sometime now. London has always been a business nucleus in this region. Recently, London was surveyed as the best city in Europe in terms of establishing a business, employing qualified people, and accessibility to market (UK Trade & Investment, 2011). Over the years, our company has earned its reputation in UK through exceptional services to customers and caring attitude towards employees and other stakeholders. However, the multidimensional dynamics of this country have often had a role to play in the functions of our subsidiary. RESEARCH It is necessary to provide you first with the fundamental research I conducted regarding United Kingdom so that you could get a feel of the country. It is a country which provides a perfect mix of traditions and modernism. Situated in Western Europe, its capital is London. The population of the country is estimated to be over 60 million (Directgov, 2012). The ethnic structure consists of a majority of whites including English, Scottish, Welsh and Northern Irish whereas smaller percentages of Blacks, Indians and Pakistanis are also found. With people migrating in huge numbers to the United Kingdom, the society has become rather a multicultural one. Though there is no declared official language, but since English is spoken by more than 70% of the population, hence it is considered to be the national language (Godfrey-Faussett et al. 2004). The United Kingdom is made up by four countries: England, Scotland, Wales and Northern Ireland (William, 2010). Foreigners often err in making use of the word ‘British’. It is imperative to know that British stands for a person who comes from any of the four countries while English, Scottish, Northern Irish and Welsh are used when referring to the particular countries of the person. Though over the last few years, people from diverse races, castes and creeds have had access to quality education, yet the class system exists in the United Kingdom in a very subliminal way. Class is not just determined through wealth but through factors such as pronunciation, conduct and deportment as well. The term ‘stiff upper lip’ has often been associated with the British. This is mainly due to their depiction of self-control and reserve in the case of intricate and thwarting situations. The British are also known for the importance which they attach with indirect behaviour. Politeness and civility are two significant characteristics of typical British behaviour (Communicaid, 2007). Commercially, United Kingdom is one of the worlds’ biggest trading zones and financial hubs. The economy of UK has always been strong; however, even UK was not able to escape from the consequences of the 2007-08 global recession. Over the years, agriculture has been an important part of the economy as efficient mechanism results in better food production. Though the country has good reserves of coal and oil, but in recent years, it is becoming an importer of energy. The sector which contributes most to the GDP is the service sector which includes financial services such as banking and insurance (Eucommerz, 2012). These were some of the basic details of the country in which you will be staying for the next three years. FINDINGS ANALYSIS Upon analyzing the research which I conducted, I was able to identify certain key components of the British culture which not only influence the daily life but the business activities as well. I will be explicating my analysis of the major dimensions of British culture in this section. The official working hours in the United Kingdom extend from 9 am to 5 pm on weekdays. However, people often arrive no earlier than 9.30 am, however, they even stay late in their offices to finish off the remaining work and do not wish to return home unless and until their work for the day is complete. The timings of the shop vary, as some shops and supermarkets in cities remain open for 24 hours. Banks usually offer services during 9.30 am to 5.30 pm from Monday to Friday. As far as making appointments in concerned, it is advised to make it in advance to avoid any discrepancies. However, the British business people are generally good enough to entertain even short notice appointments. However, this is not the case when you intend to meet with political people especially parliamentarians. It is also suggested that appointments should be avoided in the months of July and August as these are considered to be the vacation period for families. The business also closes between Christmas and the New Year. Moreover, there are only eight national holidays in the UK. Punctuality is considered highly important at any meeting, social event or occasion in the UK (Ediplomat, 2012). However, being late by ten to fifteen minutes is not regarded as offensive. At the same time, it is also not desirable to arrive too early as well. The transportation factor is also vital in case of appointments. In the last few decades, traffic has increased a great deal especially in London and South east England. The ‘Tube’ and the long distance rail services affect traffic the most. As a result, when leaving for an important meeting, it is crucial that you keep an extra bit of time on your hand in order to avoid the traffic hindrance (Globaledge, 2012). According to the UK business norms, men and women both are required to wear conservative dress. In cities, formal clothes with dark colours and weighty fabrics prevail. Though it may seem to you that people are unconcerned with your style or do not pay much notice to your dress, however, there exists a snooty consciousness of the dress code among the British. Men’s clothing has to be very professional especially if they are top managers, bankers, lawyers or other high level officials. Darks suits and ties comprise the standard dress code. Ties carry a lot of significance; consequently, stripped ties are not believed to be formal as they mean that you belong to any institution such as school, armed forces or any sort of club. On the other hand, women should be dressed in suits or skirts and blouses. However, neither men nor women are needed to wear a blazer while working as it is rather considered to be a dress for the weekend. People in middle management wear dresses contingent on cost factors. Those who work in media may put on more flashy dresses. On casual occasions, men and women can wear jackets and sweaters. When off duty, inhabitants of UK may choose to dress in any casual dress they feel pertinent. In case of ceremonial events, men can wear black ties, formal suits and coats. Women may replicate them with the addition of any stylish fashion accessory such as handbag or any other ornament (Gardiner et al. 2000) An important point for men is not to put pens, pencils, etc in the upper pockets of their shirt, coat or jacket; instead, a handkerchief can be placed in that (Globaledge, 2012). British tend to be reticent as far as conversation goes. They do not like to promptly indulge in a conversation with a stranger. Though there may be cases in which an idle conversation is initiated, particularly, while travelling through trains and buses. It is believed that people from Northern areas are much more instantaneous in developing friendships in contrast to their southern counterparts. You should not find it rude if people outside Southeast England speak to you in very demonstrative terms such as ’love’ or ‘dear’. The tone of the British is low, modest and calculated. They do not like to be involved in very vibrant or intense talks as they prefer keeping a personal space for themselves and not getting carried away in a conversation. You should not try and indulge in discussion with someone in a drunken state as it might lead to you making excuses and being embarrassed ultimately. In UK, it is essential to speak in complete sentences rather than short phrases, which are considered to be particularly irritating by the locals. It is also advised to be very careful in the selection of words while talking to British. At the same time, people of the United Kingdom, known for their indirectness may use subtle ironies and sarcasm in their conversation depicting fervour, antagonism or apathy which foreigners might find a bit difficult to digest; however, if you want to initiate any kind of relationship, you need to be tolerant in this regard. Though portrayed as restraint and reserved, British from time to time put aside their seriousness with a very good sense of humour and wittiness. You should be able to recognize this aspect of their personality and treat it in a light way rather than trying to imitate them. With United Kingdom being a multicultural society, it is strictly advised not to make any suppositions about a person’s race, ethnicity, creed or caste. Furthermore, any discussion related to the controversial Northern Ireland or independence movements in Scotland should never be touched upon as these issues have always been a cause of uncertainty in the United Kingdom (Jordan-Bychkov et al, 2002). If ever you attempt to commence a conversation with a stranger, it is better to use the shield of newspaper while doing this, as newspaper will not only act as a protective tool but also make available plenty of substantial and neutral material to talk about. Otherwise, weather is often considered to be a very safe topic to begin conversation with. Some other harmless themes may include sports, animals, history, art, literature, food, music and current affairs. Conversely, some of the subjects which should be refrained from comprise of European Union, Euro, private queries, race, class, religion, Middle East, politics and Royal Family (Globaledge, 2012). Though the British are known for their firm formality, the direct use of first names is becoming very common especially among the newer generations and novel industries. However, this does not mean that you adopt a very casual attitude in this regard. This is because a large chunk of people exist who belong to the traditional period and who still prefer the conventional way of living. Moreover, you should not use a person’s first name unless and until your relationship becomes informal; however, if this does not happen, then it is safer to employ the formal way. Consequently, it is utmost necessary to be very careful in addressing people. It is better to err by being overformal rather than by being casual. People are not affronted by an inflated attempt of being formal but they certainly are in case of hasty casualness. You are also advised not to repeat a person’s name time and again in a conversation (Minkov, 2011). It is also suggested that when you address people of royal ranks such as Queen, Bishop or Lord, you apply high respect and deference. In case of business people, it is better to use the title of the person mentioned in his card or by which he is known in the business circles. Formality is also necessary in case of writing letters. You should be using the formal title of the person addressed until, in some way, he indicates you to use the first name (Cheng, 2003). Though comparatively less strictness applies in the case of emails, however you should still be careful not only about formality but also spellings and grammar. When involved in meetings or conferences, you are again advised to use the titles of the members such as Mr. Chairman, even if you usually employ first name terms with them. If you are ever unsure about the matrimonial status of a lady, it is safer to use Ms. It would be very courteous if you also endeavour to eradicate the suffix ‘man’ which might upshot in an unpleasant yet highly reputable expression such as Madam Chair. Though close friends often call each other by either using only the first names or surnames, but this practice should not be replicated and it is often more secure to add Mr. or Ms along with the surname. Shopkeepers and hotel attendants make use of Sir and Madam to talk to their customers. Though you may not find many Knights in the world of business, but you should be aware that they are supposed to be addressed as Sir while their female counterparts must be called as Dame (Globaledge, 2012). In United Kingdom, gifts are generally not exchanged in businesses. However when you visit someone’s house, it is considered good to carry a small gift alongside you, such as a bouquet of flowers, books or few chocolates. Care should be taken when sending gifts in case of a dinner party. White flowers should be avoided as they may be perceived as a symbol of death by the receiver. At business meetings, you should shake hands with everyone present including women, though it is courteous for women to extend their hand first. Handshakes are supposed to be light. Touching, hugging, kissing and other forms of affection are not desirable in public and are primarily reserved for family members and intimate friends. Staring and intentional glancing are believed to constitute rude attitude. There exist certain norms in UK with regard to formal business dinners and entertainment aspects as well. You are not supposed to shout in order to call a waiter; instead you must raise your hand. Business entertaining is usually done through lunch in restaurants. While on occasions, businessmen invite each other to watch sport such as cricket or soccer. If a businessman invites you to his home for a dinner, then you are not required to initiate any talk regarding business; you should wait for the host to begin it. The honour guest usually sits to the right of the host. You should not begin eating before the host does. Likewise, you need to be formal in your attitude and should not ask the host to tour you around his home. In addition to that, all the manners which usually apply to dining such as placing your hands on the table and leaving very small amount of food in your plate after the dinner are equally applicable in UK (Ediplomat, 2012). Culture can be defined as the set of inner beliefs and values held by groups of people and when applied to businesses, it becomes corporate culture (Peterson, 2004) The corporate culture of United Kingdom has its own characteristics and peculiarities, the knowledge of which is vital for any foreigner’s success in this part of the world. Though the younger generation of UK is considered to be perfectly competent of handling negotiations in business, but still trust is placed in the senior and more experienced officers of the company who have gone through various ups an downs in their life and are well aware of the subtleties which are required from the negotiator’s part in order to reach upon a successful deal. Deference and dignity attached with the older people often plays a crucial role in negotiations in the UK. In the last few years, though many women and blacks have climbed their way up to higher managerial positions in Multinational Organisations of the United Kingdom, however, outside of London, stereotyping and biased attitude with regard to women, blacks and Asians is somewhat prevalent. In such areas, businesses are usually dominated by white men; while women, blacks and Asians must maintain a professional outlook and perform better than others in order to survive in their companies. When you go for a meeting, you need to be systematically prepared (Minkov, 2011). British businessmen being emotionally detached, place high importance in facts, figures and other statistical details. Consequently, you have to keep these factors in mind while you get ready for a meeting. It often happens in UK that meetings tend to be highly successful, yet the ultimate decision taken goes against you. This is mainly because the final power and authority usually lies with the people who are at the top of the organisation (Shonhiwa, 2006). In fact, often the culture of the organisations is influenced by the culture from which the leader comes (Schein, 2010). In UK, though team work is gaining importance in recent times; however, the boss prefers to remain aloof in order to maintain his superior authority over his subordinates. Though British tend to regard immediate and short term results as more significant in contrast to long term results, yet they believe in establishing long term relationships not only with their customers but also employees, staff and business partners. Over the years, there has also been an attitude among the British organisations to follow the rules, procedures, principles and techniques that have previously yielded results from them. As a result, if two individuals come up with two proposals, then the one whose proposal is traditional and seems to obey the rules is given preference. In other words, conventional methods are given more importance and decision making results to be unhurried and calculated. However, in recent times, the trends are beginning to change as the hierarchical organisational structure with a rigid chain of command is losing its popularity and with Multinational Corporations such as ours operating in this country, flexible and flat structures are being perceived as better ones. This is due to the fact that such organisations involve every employee in decision making, promote teamwork, telecommuting, flexible timings, creativity and innovation. During business meetings in the United Kingdom, success is dependant on demeanour and professional attitude. British are very meticulous observers, assessing your each and every action. You might find them quiet but at the same time, you should realize that they continuously judge your attitude and consequently, your proposal and your company. Foreigners often do not realize this and when they do, it almost comes to them as a cultural shock (Ward et al. 2001). Apart from that, British businessmen may also use witty techniques of sarcasm, irony and humour to evaluate your character, patience and temperament. British are believed to be experts at using irony which involves saying something and implying its contrary and accordingly, manners and facial expressions can often prove to be misleading in this country. This is sometimes also done to ridicule the opponent and state one’s purpose indirectly. However, this attitude should not be reciprocated by you or any foreigner in that case, especially if you wish to sell your idea or seek acceptance of your proposal because British do not believe in long term feelings of resentment (Globaledge, 2012). The UK governments have always made an attempt to maintain good relationships with the subsidiaries of foreign Multinational Organisations by continuously keeping them up to date with all the legal developments in the business sector and facilitating their operations in the country by smoothing the progress of their development and expansion. However, there are certain upcoming issues which must be kept in mind such as the latest Financial and Operating review that compels organisations such as ours to constantly report on social and ecological impact of our activities. Meanwhile, the organisation for Economic Cooperation and Development has formed a platform at which complaints against Multinational Organisations can be brought forward by people (Cafod, n.d.). Since, our subsidiary is a licensee of our Multinational Organisation, therefore it operates independently in London and we need to be very circumspect and wise in handling such issues. You must also be aware of the fact that our subsidiary has often developed innovative Human Resource Practices which have not only been appreciated by other subsidiaries and our mother organisation but have also been adopted by them. This is not only the case with our subsidiary but 61% of UK subsidiaries of worldwide Multinational organisations have yielded efficient and ingenious Human Resource practices for their mother firm (Innovations Report, 2007). In my view, this innovation and development is not only the result of the hard work of the people but also the influence which the market of United Kingdom has on the business environment. As far as our company is concerned, we thoroughly feel that while operating in UK; we have a vital role to play in the strategic development of our company along with international accountability for our goods. The population of UK is very educated and consequently, it has always been very difficult for firms to compete in the market unless and until they satisfy the requirements of the knowledgeable customers. Moreover, in wake of increasing globalization accompanied by advances in communication and technology, customers demand the best at the most relevant prices (Moore, 2005). In view of such an atmosphere, our subsidiary has always made an effort to think out of the box and come up with innovative marketing strategies. Consequently, we have followed the approach of a modern and smart competitor which focuses at a target market and puts marketing at the beginning of planning (Kotler, 2009). RECOMMENDATIONS & CONCLUSIONS In today’s world, manager’s role has changed drastically and only those managers are able to survive in the heated competition; who are well aware of the international factors affecting their firms. Consequently, our subsidiary being situated at the heart of United Kingdom has always required detailed attention from us towards global economic aspects and international strategies. In order to deal with the cultural nuances of United Kingdom and to overcome the challenges faced by subsidiaries in United Kingdom, I would like to recommend you to firstly understand the culture of this country thoroughly. Secondly, it is essential that you do not impose your culture even indirectly on the people of this country (Lundby, 2010). You should also ensure that cultural differences do not impede in the progress of our subsidiary. People of various backgrounds and ethnicities work in our subsidiary; thus, there is a need to maintain harmony among them and this is only possible when you display tolerance and develop relationships of mutual confidence and respect overshadowing the cultural barricades (Hodgetts et al, 2005). Cultural differences can also be utilized in a positive way by making use of the diverse opinions, insights and knowledge of the people. In this way, you can not only eliminate the feelings related to cultural obstacles but also develop a strong multicultural team (Babu, 2006). A tool which can help you immensely with regard to adapting to a new culture is Cultural Intelligence. It is also believed to be a quality associated with expatriate managers. The primary requirement of Cultural Intelligence is to understand your own culture first (Livermore, 2009). Only when you are well mindful of your own culture, you will be able to recognize the subtle differences of other cultures. The next step is to undergo a thorough study of the culture of the country in which you are supposed to move to. In your case, you might find the above information about UK’s culture provided by me useful; in addition to this, you may study other books and documents as well on British people to enhance your understanding about them. However, development of Cultural Intelligence also requires strong determination from your part. You should be determined to adapt to the culture of UK and live comfortably in this country for the next 3 years. Motivation is another key factor which assists in preventing cultural shock and adapting to new cultures. Consequently, you should view this three year contract in UK as a challenge and accordingly motivate yourself to perform successfully in this endeavour (Thomas et al, 2004). POST REPORT REFLECTION I would like to say that in this report, I made a meticulous endeavour through research, analysis and recommendations to elucidate the British norms and values in addition to the business atmosphere and commercial practices of this country. I sincerely hope that this attempt of mine would enable you to maximize the benefits of cultural differences and minimize the negatives. Furthermore, I wish that your three year stay in United Kingdom not only turns out to be effective from the business point of view, but you also enjoy this term as a person, acclimatizing to the unique yet admirable culture of UK. BIBLIOGRAPHY BABU K, M. (2006). Offshoring IT services: a framework for managing outsourced projects. New Delhi, Tata McGraw-Hill Pub. CAFOD. (n.d.). Multinational Corporations. [online] Available from: http://www.cafod.org.uk/var/storage/original/application/php185MId.pdf[Accessed 6 February 2012]. CHENG, W. (2003). Intercultural conversation. Amsterdam, John Benjamins Pub. Co. COMMUNICAID. (2007). Doing Business in the UK. [online] Available from: http://www.communicaid.com/cross-cultural-training/culture-for-business-and-management/doing-business-in/British-business-and-social-culture.php[Accessed 6 February 2012]. 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(2004). Cultural intelligence: a guide to working with people from other cultures. Yarmouth, ME, Intercultural Press. SCHEIN, E. H., & SCHEIN, E. H. (2010). Organisational culture and leadership. San Francisco, Calif, Jossey-Bass. SHONHIWA, S. (2006). The effective cross-cultural manager: a guide for business leaders in Africa. Cape Town [South Africa], Zebra. THOMAS, D. C., & INKSON, K. (2003). Cultural intelligence: people skills for global business. San Francisco, CA, Berrett-Koehler. UK Trade and Investment, (2011). Key Facts. [online] Available from: http://www.ukti.gov.uk/uktihome/aboutukti/item/108057.html[Accessed 6 February 2012]. WARD, C., BOCHNER, S., & FURNHAM, A. (2001). The psychology of culture shock. London, Routledge. WILLIAM, D. (2010). Life in the United Kingdom The Land and the People. Gardners Books. Read More