How does culture impact on the planning and carrying out of international strategy and negotiations.
The main motive of this essay is to see how culture impact on plan and implementation of international strategy and negotiations in business world. The essay consist of concept of culture in broad sense. Then the paper present a short overview of Hofstede’s culture framework. The type of culture is broadly classified and majorly distributed into two section namely corporate and national. International strategy is defined in brief and mode of different strategy is also touched, then the paper take a brief presentation of cultural impact both corporate as well as national on formulation as ...view middle of the document...
There are many dimension that have been applied to classify culture. The most popular one is Hofstede’s dimension. Which is very useful in getting an overall idea of a country culture. The dimension can be classified in the bellow picture.
Figure 2 Hofstede, 1984
This essay I will focus more on country culture and corporate culture. Their effect on international strategy planning and implementation as well as their effect on international negotiation.
International business strategy
International business strategy can be defined as the theory which help manage an organization but that’s not the end of it. It is used in every step of organization be it marketing, entry mode, positioning, human resource or communication. To define International business strategy is essentially not simpler as it seems to be but we can generalize it majorly in two definitions.
First one is it is a theory which help an organization to compete and offer standardized product across the world. This particular strategy is always followed by large MNE functioning in different countries worldwide.
Secondly it can be also referred to strategy with a broad worldwide prospective. In different words it is a strategy used by organization outside of their parent countries.
National Culture impact on planning and implementation of international strategy.
When an organization go global or starts to function in more than two country. They are challenged to do majorly these two changes based on National culture of the countries involved.
1) External adaptation
2) Internal integration
It can be defined as the Cultural attitudes towards the relationship of man and the environment will influence the way organizations make sense of and respond to their environments thereby affecting the nature of external adaptation.( C. SCHNEIDER “85”).
External adaptation mainly consist of the five following factors. Control on environment, active or pacific attitude, uncertainty avoidance, believes formation based on either logic or philosophy and the importance of time.
This adaptation is wholly dependent on the country in which the organization is going.
It depends on these following factors. The first one is power distance, the second is individualism vs collectivism and the third is femininity vs masculinity. These all are from Hofstede’s cultural frameworks.
Strategy planning include how information is scanned, selected, interpreted, and validated. Issues thus identified are prioritized according to criteria relevant to the organization. However, the use of information is embedded in social norms and thereby acquires symbolic value as a function of a particular set of beliefs in a particular set of cultures (Feldman & March, 1981). This whole process has national culture impact on itself.
Example: - Infosys is a multinational corporation which work on consultancy and Information & technology support. Most of the business done by the...