International Business Difficulty/Failure -Cross Culture Problems

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International business difficulty/failure -cross culture problems

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[Date of Submission]

International business difficulty/ failure -cross culture problems

Introduction

The global market has shown an immense increase in the number of companies that are operating internationally. The world has become an open village for foreign firms that are providing new destinations for the expansion of the business of companies. The companies are required to deal with large and complex nature of tasks as a way to operate successfully in international market. In a number of ways, the international business is different from domestic business. The current scenario has provided with a fact that the challenges faced by businesses when going abroad are new and companies are usually unfamiliar with them. These types of obstacles were never faced by businesses previously but at present the issues are becoming crucial in every day work. Among these obstacles, a pivotal position is held by culture that has the potential to effect entire organization. Recognizing the cultural differences between countries where the international business operates is a very difficult task. Being unaware of the cultural differences in addition to increasing the cost of doing business, sometimes also leads to failures of business. This essay highlights the case of a Swedish company Andritz Group, a real world international business and reflects the difficulties experienced by this organization in the process of internationalization specifically due to lack of understanding of the cultural differences in the host country and the target market. The case analysis is made according to the provided guidelines for the assignment.

Cross culture and internationalization of business

There are a number of ways in which a culture can have an influence on the business and its surroundings. Some uncommon issues include language problems, difficulties in pricing the products and collisions among cultures (Zacharakis, 1996). Thus, the companies must have the potential to handle these challenges in a way that proves to be beneficial for both the host and the parent country. In case disrespect is shown for the foreign culture, the entire operations of the organization may be collapsed. The companies must provide their personnel with proper training about the manners and customs that are followed in the foreign culture. Foreign cultures are equipped with different ways of conducting business, for example in case of planning ahead and keeping up the delivery times. The influence of the cross culture can be positive and negative leading the companies to struggle in the new foreign environment.

The fact that Andritz Group failed to realize was that foreign culture is not the same as the culture is at home. The main reason for such failure was lack of preparation before starting new foreign operations. The important thing need to be considered is that the company should respect and understand the new culture without forcing own beliefs on the people. The company can easily gain trust and ascend its competitive advantage if the language of the host country is learned by the expanding organization.

Andritz Group_ a Swedish company

Operating for more than ...
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