The Cultural Challenges Of Doing Business Overseas

1152 words - 5 pages

Steve Kafka, an American of Czech origin, is a franchiser for Chicago Style Pizza and wishes to open a franchise in Prague, Czech Republic. The cultural differences between Czech Republic and United States stem from their unique historical evolution across centuries, from their specific traditions, structure of population, geographical position, surrounding peoples and cultures, and traditional cultural and economic ties with other countries.During 1945-1990, the Czech Republic had a communist regime, as part of the Socialist Republic of Czechoslovakia. Nowadays, the Czech Republic is a free market economy. One of the biggest challenges while doing business in the Czech Republic is the bureaucracy. The decision making process takes longer than for US counterparts as the business people in the Czech Republic prefer a methodical approach on analyzing proposals to in-depth details.Steve will face slow decision making situations and that he will have to overcome bureaucracy. Business relationships in the Czech Republic are more productive when trust is established. While focusing on business, Steve could benefit from developing close relationships with the people he will be working with. In order to assure continuous progress he should pay special attention to the business and tax legislation, choosing such a specific business strategy that will ensure a high economic efficiency.Since Steve has been to Czech, he knows that Czech people enjoy pizza similarly like the U.S., but Steve saw that in Prague the pizza was served in a restaurant atmosphere, and not at fast food places like Dominos Pizza and Pizza Hut (Prague City, 2006). Steve has chosen Chicago style pizza pie because it can be served like a baked pie or some version similar to a foccaccia with toppings. This style of pizza is appropriate for Czech and for the Czech's love of baked goods (Prague City, 2006). If Steve is going to get over the apprehensions of the old mentality style of his company he will have to adjust to what the country is use to (Kennedy, 2006.)In Czech, home delivery is a relatively new concept and many Czech people are not used to this convenience of having food delivered to their homes. Some Western entrepreneurs have used advertising campaign to teach the Czech people about the space age technology of keeping pizza warm (Kennedy, 2006.) Americans are completely different with modern conveniences like drive-through windows at fast food restaurants. Czech has a long history of tradition compared to the U.S., and Czech country is a very old culture. (Prague City, 2006).Czech is considered a cost-effective places to do business. This will be a comparative advantage for Steve to experiment with new products, if his products are cheap and good quality. The new jobs that people will have from working for the Western multinationals will create potential customers with money to eat pizza out at a restaurant (Kaitla, 1999). To get over the resentment of the new economy he is...

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