Unit II International business discussion board

DBA 8710, International Business and Global Strategy 1

Course Learning Outcomes for Unit II Upon completion of this unit, students should be able to:

2. Explain different approaches to analyzing global strategies. 2.1 Explain the economic and political issues that Saudi Arabia has experienced.

Course/Unit Learning Outcomes

Learning Activity

2.1 Unit Lesson Chapter 2, pp. 38–60 Unit II Case Study

Required Unit Resources Chapter 2: National Differences in Political, Economic, and Legal Systems, pp. 38–60

Unit Lesson Welcome to Unit II! We are continuing to apply the knowledge of international business and the theoretical frameworks within leadership and business on a global scale. As we expand into understanding national differences in political, economic, and legal systems, it is important to understand the large context of global consciousness. In understanding international business, it is important to see the macro level of individualism versus collectivism. Not all societies believe in individual goals first. According to Smith and Cannan (2003), if individuals focus on their interests first, then there is a direct correlation to the promotion of society as well. Despite countries having different legal systems, there is an effort on behalf of countries that are working together to recognize cultural differences (Hill, 2021). Whether it be common law, civil law, or theocratic law, countries and cultures have a great appreciation of society’s differences through the work of Hofstede (2001) and national differences. Cultural global consciousness is important to understand in regard to how transnational transactions are conducted. To do so effectively, recognizing cultural dimensions is important. Hofstede (2001) identified five major dimensions that help to define cultures across the world: power distance, individualistic and collective cultures, masculinity, femininity, and uncertainty avoidance. With the increased globalization of business, differences among various cultures may complicate interactions among businesspeople from different nations. Our cultural environment makes us act in ways that we may believe or think are appropriate. In most cases, however, behaviors that are consistent with the norms of one culture may violate the norms of another. Management is approached differently based on the cultural differences of individuals and organizations.

Communicating With People from Low-Context Cultures Consider the following guidelines for communicating with individuals from low-context cultures, which are listed below.

 Get to the point fairly quickly, and limit the amount of background information presented. If others need more information, they will ask.

 If you imply your conclusions without stating them explicitly, low-context listeners may miss or misunderstand what you are getting at; therefore, it is better to state your points very concretely.

 Use data and facts to support your points.

UNIT II STUDY GUIDE

National Differences in Political, Economic, and Legal Systems

DBA 8710, International Business and Global Strategy 2

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 Do not take a refusal or a criticism of your idea personally. Low-context communicators tend to separate criticism of issues from criticism of the people presenting the issues.

 Do not become frustrated if you have to ask many questions to get the information you want. Low- context communicators tend to assume that you will ask a question if you want to know something, and they may hesitate to offer information that is not directly solicited for fear of appearing condescending.

 Conversely, do not assume that someone who asks you a lot of questions is challenging or attacking you; they may simply be trying to get the specific information they need at the moment to make a decision.

 Be careful not to read between the lines too much. Do not assume that what someone says today is related to what he or she said yesterday. Always clarify when in doubt.

 Try to be more direct in your communication style, but be careful that you do not overdo it and express yourself too bluntly or aggressively.

Communicating With People from High-Context Cultures

Consider the following guidelines for communicating with individuals from high-context cultures, which are listed below.

 Pay more attention to the context in which communication is taking place (i.e., who is speaking, who is not speaking, what is not being said, where you are, who else is present, and what their relative status is).

 Pay close attention to nonverbal cues such as eye contact, pauses, posture, and facial expressions; however, be careful because these cues likely mean something different in your own culture.

 Do not assume that people agree with you simply because they do not immediately say “no.” People in high-context cultures often value relationships and may express themselves indirectly in order to preserve harmony. Learn how disagreement is expressed and how to uncover negative feelings that may not be directly communicated.

 Try to give feedback or disagree with someone in private so that the other person does not “lose face;” because high-context communicators are less apt to separate feelings from fact. Sometimes, utilizing a third-party is a good idea.

 A high-context communicator may ask a question as a starting point for an in-depth exchange of information and expect a great deal of detail in response. A concise answer that only addresses the specific question asked may seem unhelpful.

 Be prepared to use a variety of approaches to establish credibility and to persuade. Do not simply use facts and data, but also elaborate on who you know, how well you listen, how you dress, and how willing you are to invest in a relationship and spend time socializing.

Intercultural Interactions

Keys to Effective Intercultural Interactions

Check your assumptions. Avoid making quick judgments.

Consider alternative interpretations.

Check your conclusions.

Examine your own cultural assumptions, which may not fit in other situations.

Be willing to carefully explain your intentions.

Identify ways to adapt your behavior and style.

DBA 8710, International Business and Global Strategy 3

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Definition of Cognitive Complexity

This is the ability to grasp complex concepts quickly.

One must have strong analytical and problem-solving skills.

This is the ability to understand abstract ideas.

This is the ability to take complex issues and explain the main points simply and understandably.

Rational Decision-Making Process

This process assumes the decision maker has complete information.

A rational decision-maker is able to identify all of the relevant options in an unbiased manner.

Chooses the option with the highest utility.

Most decisions in the real world do not follow the rational model because of the theory of bounded rationality.

Theory of Bounded Rationality Most people will attempt to lower the complexity of a problem in an effort to understand and develop a solution. The limited information-processing capacity makes it difficult for people to understand all issues of the challenge. They are content to accept a solution that is simply adequate for the situation. As seen in the table below, rational decision-making is bounded (limited).

Rational Decision-Making (Limited)

Reduce complex problems to simplified models.

Provide satisfactory and sufficient solutions.

Sometimes, fast and frugal is fine. Sometimes it is not.

References Hill, C. W. L. (2021). International business: Competing in the global marketplace (13th ed.). McGraw-Hill

Education. Hofstede, G. (2001). Culture's recent consequences: Using dimension scores in theory and research.

International Journal of Cross Cultural Management, 1(1), 11–17. https://doi.org/10.1177/147059580111002

Smith, A., & Cannan, E. (2003). The wealth of nations. Bantam Classic.

Suggested Unit Resources In order to access the resources below, utilize the CSU Online Library to begin your research. The journal article below discusses foreign multinationals and how they wield a particularly significant competitive weapon in host markets.

DBA 8710, International Business and Global Strategy 4

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Siegel, J., Pyun, L., & Cheon, B. Y. (2019). Multinational firms, labor market discrimination, and the capture of outsider’s advantage by exploiting the social divide. Administrative Science Quarterly, 64(2), 370– 397. https://doi.org/10.1177/0001839218769634

The journal article below discusses research on the important managerial question of how to maximize returns on investments in either international business or international marketing literature. Sood, A., & Kumar, V. (2018). Client profitability of diffusion segments across countries for multi-generational

innovations: The influence of firm, market, and cross-national differences. Journal of International Business Studies, 49(9), 1237–1262. https://doi.org/10.1057/s41267-018-0163-7