The Problems Of International Business

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Every country differs in culture which has been there for centuries. The international market is growing rapidly, with more and more multinational organisations entering new markets each day. In this assignment I will evaluate how the difference in cultures affects the performance of international businesses.

Globalization and technological advancement have dictated the need for managers to deal with multiple ethnic groups with different culture in their day to day interactions. According to Kulkarni (2012), cultures play critical roles in individuals, including values, beliefs, humor, worries, fears, hopes, opinions, attachments, and anxieties.

Which is cost difference determines the patterns of international trade. Absolute advantage is trade benefits when each country is at least cost producer of one of the goods being traded. In the 1800s, David Ricardo developed the theory of comparative advantage to measure gains from trades. This theory is based on comparative advantage and it states each nation should specialize in production of those goods for which its relatively more efficient with a lower opportunity cost.

Because the communication process is so complex and dynamic there is an infinite amount of opportunities for sending and receiving incorrect messages. All too frequently, communication is faulty resulting in misperceptions and misunderstandings (Northouse & Northouse, 1998).

There are many cultural and ethical differences between countries and it is important for mutual trust and respect that no organization try to strong-arm another into their way of thinking or take a position that their culture is more valuable than the other. According to Pitta, Fung, and Isberg (1999), it is vital for success to have a basic understanding of the culture and the expectations within cultures as they affect all business transactions. Failing to understand and consider the cultural differences will likely result in failure.

In multinational workplaces understanding how important the significance of cultural differences is larger than we might think. Organizations that are diverse have to work together because their functionality impacts the productivity of the workplace. It is vital to have an understanding the different cultures to develop a strong organization. Certain principles will help you acknowledge that different cultures exist within the organization. As a manager, you have to analyze the reasons for the development of the differences and

It is critical to organizations because the employees are from different cultural backgrounds. These distinctions have to be considered when making decisions because they have an impact on formal work relationships and performance. This understanding is more paramount to multinational organizations because they have business operations right at the heart of different cultures in the various countries. The success of global firms depends on how well the management handles the cultural differences and uses them to the advantage of the

Culture is one of the terms that have been becoming more familiar in the 21st century among the multinational companies all around the world. The world has been shrunken by the fasting travelling and communicating technologies which has brought down the barriers for the organisations having business in international market. But still then there are few barriers that make the international business critical and hard for everyone to succeed in it. This is due to the factor that the businesses have direct influence over the culture that is followed in the respective country where the business is carried out. So it would be interesting to

International management is defined as the practice of business operations in multiple countries. To be involved in international management professionals must be familiar with many different types of language, culture, economies, and environments. One of the main goals of international management is to link businesses globally and make a profit, while being able to connect various cultures.

     Cultures are varying among different parts of the globe. People with different cultures have different characteristics and viewpoints on the subjects due to diverse understanding and method of learning. During the past few decades, the international trade grows in a very rapid rate due to the advantages that it provides; “increased sales, operational efficiencies, exposure to new technologies and broader consumer choices” (Heslin). Therefore, when considering the culture aspect to current business world, it is crucial for business to understand the culture aspect because of the tremendous growth of international business as well as utilize the international market to its maximum

Brail can be classified into two cultures; the upper class and the non-westernized rural culture. The most prominent reason multinational businesses fail abroad is because they are unaware of the culture. Therefore, it is imperative that managers learn to adopt and implement distinct ways of working in this country. In addition to learning a new language, a manager should become a part of the cultural processes.

If both of these countries were given resources to produce both oil and cars it would be a waste for both the countries therefore by trading with each other, Japan and Saudi Arabia employ their respective resources efficiently by mutually benefiting from each other’s relationship. Japan gets oil that it needs to power its cars, and Saudi Arabia gets the cars that its citizen needs. Thus products that countries produce and with which they can trade freely with others countries and can achieve substantial gains from trade and can result in improving national living standards.

INTERNATIONAL MANAGEMENT: CULTURE, STRATEGY, AND BEHAVIOR, EIGHTH EDITION Published by McGraw-Hill, a business unit of The McGraw-Hill Companies, Inc., 1221 Avenue of the Americas, New York, NY 10020. Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved. Previous editions © 2009, 2006, and 2003. No part of this publication may be reproduced or distributed in any form or by any means, or stored in a database or retrieval system, without the prior written consent of The McGraw-Hill Companies, Inc., including, but not limited

Managers were concerned about knowing and understanding each and every perspective of their employee’s cultures. As they know that without studying or knowing the culture, coordination cannot be built between the employees. It is the existing perspective of managers dealing with cross-cultural management (Sultana, 2013).