It is the sample solved short questions. It follows the best format to solve the questions in HI5013.
Scenario
The majority of MNCs are American businesses (multi-national corporations).
However, a lot of people think that Americans are not well-suited to help a
company integrate into a non-American culture. The majority of MNCs are American
businesses (multi-national corporations). However, a lot of people think that
Americans are not well-suited to help a company integrate into a non-American
culture.
Describe
the features of American culture that would prevent having empathy for and
understanding another culture.
Main Characteristics of American Culture
Geographical Size
Because of the size of the geographical area, Americans do not worry about
the culture. Different communities have different cultural values. However, the
society does not enjoy the love of various other cultures. Americans find it
challenging to support other cultures because of the diversity in the nation.
Religion is not a Powerful Social Custom
The social norms and humanistic values that underpin American society.
However, despite its reputation as a strong social custom, religion does not
play a significant part in forming American society.
Difference in Language and Practices
Language is where society differs most. As a result of linguistic and
cultural differences, it is challenging for Americans to work in or enter a new
non-American market. The handshake and eye contact are cultural norms among
Americans. As a result, it is considered extremely impolite to avoid eye
contact during conversation. However, it is not necessary for other cultures
around the world to conduct business, nor is it part of their culture.
On the other hand, in some cultures, maintaining constant eye contact is
seen as rude. In America, the distinctive cultural identity is not given the
same consideration; instead, upholding the stated standards and values is the
main priority. However, in order to succeed in business operations abroad, it
is critical to have familiarity and connections with other cultures.
Explain the Uppsala model and how it assists organisations to expand
globally.
Uppsala Model
Johnson and Wiedersheim-Paul and Johnson and Vahlne, two Swedish
researchers, produced the Uppsala model for internationalisation in 1975 and
1977, respectively. The idea is based on an incremental, sequential approach to
internationalisation. The model is renowned for how businesses approach the
internationalisation process. According to the model, there isn't a lot of data
or information available for the international market.
Assistance for Organizations
Consequently, it is detrimental to entry on a global scale. In the model, it
is advised to first establish operations and a reputation in the domestic or
local market before expanding the business internationally.
The Uppsala model has been singled out among four business expansion
strategies; Stage 1: Irregular exports with sporadic exports Stage 2: Exports
through unaffiliated agents Stage 3: Create a subsidiary for international
sales Stage 4: Quality-based manufacturing facilities for export.
The model also emphasises four key ideas: commitment to the market, market
knowledge, commitment choices, and market activities. Understanding the
established chain is essential for carrying out operations and growing the
business. Once a business has achieved local market success, it must then
concentrate on its core principles and work on its internationalisation process
in order to expand with assurance.
Scenario
Even though many MNCs promote and adhere to strict social responsibility
standards in their home countries, they are frequently less conscientious when
it comes to "host" or foreign countries. The Bhopal disaster in
Madhya Pradesh, India, claimed 3,787 lives and affected an additional 558,125
people in 1984. The company in question was Union Carbide, which is primarily
owned by Americans. The Chairman and other top executives were found guilty by
Indian courts of "...causing death by negligence."
Why do you think Union Carbide's
negligence policies were less strict in India than they were in the USA?
Union Carbide – Less Stringent Policy
When 45 tonnes of gas methyl isocyanate escaped from a Union Carbide Company
plant in the United States, the Bhopal disaster occurred. For the businesses or
organisations that support the plants based on the harmful chemicals employed.
The investigation of the metal reveals that the safety procedures and operating
standard at the plant were not the main things to follow and guarantee the safe
environment. It is important to maintain the standards to operate it
successfully.
both from the perspective of the company's employees and of the carbide
corporation. But according to the reports, there have been complaints and rages
from the workers over the dhep dangerous position at the plant. However, the
management did nothing about it, and some of the workers' negligence as well as
that of the management played a major role in the disastrous events that
occurred.
What is the way to fix this situation? Explain whether it is
legislation or cultural change from MNCs that is required?
Changes on Both Cultural and Legislation Level was Required
There was a need for safety recommendations on both the level of culture and
legislation because the incident resulted in the deaths of more than 3000
people and there was a chance that the Bhopal spill could have been avoided. In
order to guarantee the workers' safety on the job, the organisation needed to
work on standards and responsibilities. It was also the management's duty to
work in an environment where the management was expected to be concerned about
staff training in order to alter the corporate culture and create a safe workplace.
Only when the company's leadership in India was concerned about people's
safety was working in a safe environment possible. There were two International
Labor organisations present, along with the workers' complaint and supporting
documentation. Additionally, an international confederation of free trade
unions was involved in causing the incident to occur due to the company's
management's lax policies and reckless behaviour.
The worst industrial accident might have been avoided if company officials
had paid attention to the seriousness of the situation. However, little to no
action was taken to address the issue that caused the disastrous historical
event.
Scenario
In the last 20 years, communication has undergone a revolution. Executives
can now communicate with offshore subsidiaries in host countries
around-the-clock using a variety of technologies. These executives frequently
lack a thorough understanding of the area or the host nation's culture or
social structure.
What are some of the typical problems
that prevent understanding. To find the answer, use the communication model.
ANSWER i):
According to the interaction communication model, communication is a process
where participants in different roles, like sender or receiver, have a unique
"me" to generate a message to send or receive feedback with both
physical and psychological context. Schrammin delivered it in 1997. Rather than
viewing communication as a linear process This process is two-way. However, the
communication becomes more interactive with the use of a model to demonstrate
feedback, which calls for the inclusion of messages that allow the recipient to
respond to the sender.
Similar to this, when there is an organisation where exactive to do not have
the understanding of the various cultures and Societies of the country, there
is an emphasis on communication. As a result, communicating with the management
of the staff there becomes a significant challenge. Additionally, there is a
problem with the way that the leadership of the organisation or business is
biassed, making it impossible for them to coordinate their relationships with
customers, which will have a detrimental effect on the company's goodwill. The
model suggests that two-way communication with feedback is necessary.
Therefore, exactives working in a different cultural society should have
better communication with management. To ensure a stronger customer
relationship with the business, coordination and communication with the
customers should also be made. When a customer is unable to relate to an
organisation in a genuine way and must settle for merely purchasing goods or
services, it will cause a significant loss to the company's goodwill or
reputation.
Due to the ease of communication,
executives in head offices have also been able to override the decisions made
by managing executives in host countries and impose their own decision-making
processes on them. Comment on whether you think this is good or bad for the
MNC.
ANSWER ii):
Truly, it is detrimental for organisations to decide whether certain
branches should operate in the host nation or not. The branches are a part of
various societies and cultures. As a result, decisions and rules cannot be
based on a society's or culture's values. Strategic planning and
decision-making should be based on the unique culture and society of the region
in which the business is located.
There is no question that the host nation has independent laws and
government. However, there cannot be any government intervention from the host
country to influence business operations in another country. However, the free
style of management is necessary. However, a lot of businesses adhere to
Hofstede's cultural model. According to the focus of the leadership, formal
regulations and decision-making must be adhered to.
However, there is a need to implement various business and cultural
strategies in order to operate outside of the host nation. People in Europe and
Asia, for instance, have different tastes in food. Therefore, the menus served
in Europe cannot be served in Asian nations like China and India.
Scenario
Consider that you are a strategic
planning consultant who has been asked to help a business assess its entry
strategy for a new country. What are the parameters you would look at?
ANSWER:
Keeping in mind the company's current situation is crucial as it works to
expand into a new nation and become more globally competitive. However, once a
nation has the assurance to remain competitive in a given market, it should
engage in strategic planning. However, as a strategic planning consultant, it
is necessary to perform a SWOT analysis in order to comprehend the country's
opportunities, threats, and strengths.
Without an analysis of the company's current situation, it is impossible to
determine whether it will remain sustainable in the new nation. Analysis of the
culture and societal norms of the nation in which the business will operate is
necessary. The management of the staff must be present as well in order for the
show to succeed. But all of this can be accomplished through strategic
planning, which is based on a SWOT analysis, where the opportunity section can
provide the best advice for a company looking to expand into a new market.
Scenario
A successful national business
frequently has to make a big decision when deciding to become an MNC. What
steps can a company take before launching a wholly owned home office operation
in a host nation?
ANSWER:
The team's ability to implement these strategies and move the company toward
sustainability depends on the owner's confidence and commitment. Investor
confidence is crucial for any business in order to sustain itself over the long
term. Therefore, it is crucial to go through the stages of financial analysis
in order for a business to pass the operation surveyor in a host country and
have complete confidence to expand or enter in another country.
In order to understand investments in the financial institution and obtain
the interest of profitability on the investment, the liquidity coverage ratio
must be analysed. Similar to this, a leverage ratio analysis should be
performed to comprehend the position of the company's assets and to have a
percentage aur a show below 50 of 40% to support confidence. It is crucial to
feel secure about the company's financial situation. To meet the witnesses'
immediate financial obligations, it's critical to have a 2:1 ratio of assets to
liabilities. Therefore, keeping the assets is necessary to ensure the long-term
viability of the company.
Scenario
Nestle, a multinational corporation (MNC) with headquarters in Switzerland
that manufactures and distributes food and beverage products, was accused of
'hooking' African mothers onto the use of infant formula powdered milk for
their infants rather than mothers' breast milk in the 1970s. Many babies died because
the powder had to be mixed with dirty African water.
The Nestle organisation in Africa was divided into separate departments for
product, marketing, and sales. It was a stand-alone company. Therefore, the
infant powdered milk was being "mis-sold" and
"mis-represented," which resulted in dead African babies, but the
sales and product executives in Switzerland were unaware of this. Many
commentators held that the African company's organisational design, which
lacked Swiss oversight, was to blame.
It is fair to say that Nestle made significant and profound
changes to its governance structure after this event.
Describe what you think might have
been missing from Nestle Africa's operations. Did they create a dangerous
product to fill a fictitious need?
ANSWER i):
The Nestle and Africa case made it abundantly clear that the decision by the
company to produce milk in powder form for infants was not a mistake.
Contrarily, there were instances where children were given impure, harmful
water that shouldn't have been consumed by infants. So, this explains why
Nestle powdered milk caused the majority of infant deaths in Africa.
However, what was being questioned was not the truth regarding the Nestle's
safety and security. However, there was a pretty big lie about the water that
was used in Africa to feed the babies on the other side. Such a dangerous
product was not created by Nestle. However, Nestle products have a strong
reputation and are popular worldwide. Thus, in the case of Africa, the predict
was safe, but the water was unsafe to use, which was in no way the nestle's
fault.
Think about whether Nestle deserves
blame for establishing an unsupervised, independent subsidiary in Africa.
Describe the structure that you believe would be more suitable. Consider the
requirement for reliable product support from a well-equipped head office.
ANSWER ii):
It is Nestle's duty to produce products that are safe for all of its
customers worldwide. Nestle is a multinational corporation that provides
consumers with a variety of goods that are related to various food categories
and staples. On the other hand, Nestle products explicitly state that safe
water must be used and that the original, natural mother milk cannot be
substituted. This means that it is not the corporation's responsibility to
provide consumers with safe water so that they can use the product.
To have better consumer awareness, particularly in places like Africa where
there are uneducated people who would not be aware of their own health issues,
it is necessary to have a well-resourced Nestle head office where strategic
planning should be done going forward.
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