International Business and Culture in Brazil - Case Study Example

INTERNATIONAL BUSINESS Submitted Case Study: You work for a software development company based in Spain. Although you are only 27 years old you have co-founded this young but successful business which has already secured contracts with global brand names. You are preparing for two business trips. The first is to Brazil where you will be pitching for business in São Paulo. What will you need to consider in terms of intercultural factors that may help or hinder your success? How will you overcome these issues?  You also need to travel next business trip is to your clients Bang and Olufsen, in Denmark, to discuss their concerns with the progress of their project with you. Identify the type of problems that might be due to intercultural differences. How will you pre-empt the discussions and what solutions can you prepare to overcome their concerns and maintain the client relationship.  INTERNATIONAL BUSINESS AND CULTURE: The term “International business” revolves around all the business activities which are carried out between two or more countries. This involves a cross-border transaction of goods and services between different countries, regions or nations (Daniels, Radebaugh and Sullivan, 2007). There are different factors that play an important role in determining the success of an international venture in the other country. However, different multinational corporations consider different factors before entering into the global market. These factors include political, cultural, environmental, technological and economical aspects. It has been observed that cultural factors play an important role in determining the success of a business and its acceptability in the society of a particular country (Harrison, and Huntington, 2000). INTERCULTURAL FACTORS AND THE POTENTIAL IMPACT: Awareness with the intercultural factors is necessary for two main reasons. Firstly, it reduces the chances of misunderstandings as well as it also minimizes the possibilities of any intercultural mishaps. Secondly, the effective use of intercultural factors helps in maximizing the potential of a business and cultivating everlasting relations with the business partners across borders. Using intercultural differences productively also helps in maximizing business opportunities in other countries (Wiseman, 2003). INTERCULTURAL FACTORS THAT MAY HINDER THE SUCCESS IN BRAZIL (Sao Paulo): Skills, knowledge and experience play an important role in determining the success of a business in a global market. However, it has been observed that those companies who fail to understand the cultural awareness in a certain global market end up in absolute failure. Their lack of understanding the cultural differences and similarities of another country makes them unsuccessful in the global marketplace. It is important to understand that what may be acceptable in one country or culture may not be acceptable in other cultures. There are certain factors that one should keep in mind before entering into a global marketplace (Wiseman, 2003). With the passage of time, Brazil has emerged on the map of the world as a new emerging economy with unlimited business opportunities for people and businesses from all around the world. Brazil is known as the largest country in South America both in terms of land and population. Brazilians speak a different language as compare to rest of the South America. It is a rich country blessed with unlimited natural resources. It is important to analyze the certain cultural factors that can either hinder or help an international business venture within the country. Therefore, a careful cultural analysis of the country will help an organization to learn better about the various cultural factors that may ensure the success or the failure of that organization before entering in the market < http://www.cyborlink.com/besite/brazil.htm> Brazil has two main business hubs or the cities which are known for their unlimited business opportunities for international businesses and entrepreneurs. Sao Paulo and Rio de Janeiro are known for the business potentiality in global market. Sao Paulo is the second largest city that is known for its popularity and rich diversity < http://www.cyborlink.com/besite/brazil.htm>s. Brazil is one of the fastest growing economies in the entire world. It is important to understand the different intercultural factors that may influence the success of a business. INTERCULTURAL FACTORS IN BRAZIL: There are different intercultural factors such as intercultural communication, language, business etiquettes and protocols that play a vital role in determining the success of a business if they are analyzed thoroughly. Intercultural Communication: Communication plays a vital role in the exchange of information from one person to another. Intercultural communication can be difficult most of the times but an effective communication plays an important role in the better understanding of the people from diverse cultural backgrounds (Beaulieu, 2004). There are some key factors that one should consider while communicating on a business deal in Brazil. Ethnocentrism: Ethnocentrism can have an adverse affect on the success of a business. This term refers to the belief that one culture is superior to the other. This may harm the overall effectiveness of the intercultural communication. Awareness regarding cultural differences may help to overcome the ethnocentrism and to improve intercultural communication (Beaulieu, 2004). Language: Language plays an important role in bridging the communication gap between the two groups from different cultural backgrounds. However, sometimes language could be a barrier in effective communication when both the groups speak different languages. Brazilians speak Portuguese, therefore; avoid speaking Spanish with them. Since English has been the international language which is widely spoken and understood by majority of Brazilians. But language could hinder the business deal between the two groups who speak different languages as it can misinterpret the information between them. Therefore one should consider the language as a possible factor that could have the adverse affect on the business deal. Cultural Sensitivity: Cultural sensitivity plays an important role in determining the success of a business in international market. It has a direct impact on the effectiveness on the intercultural communication (Beaulieu, 2004). Cultural sensitivity highlights the cultural values, beliefs, traditions, behaviors and other cultural differences of a particular country. It allows a person to adapt the changes of the new culture through communication and by understanding the behavioral patterns. Before starting a business in Brazil, it is highly important to understand their values, behaviors and other cultural differences. Brazilians have an informal behavior but it is important to avoid the sensitive topics which could ignite the flame between the two parties. Business Etiquettes and Protocols: Before starting a business in Brazil, it is important to understand their business etiquettes and protocols. Every country has its own set of business etiquettes and protocols that represents their cultural values and differences with the other cultures. Brazilians have informal behavior. They prefer coming on time for the business meeting in different cities such as Sao Paulo and Brasilia however; coming late for a business meeting in Rio de Janeiro is acceptable to some extent. Brazilians prefer the flow of communication to be smooth and clear. On the other hand, they pay close attention to the body language and gestures of their international business partners. Therefore, it is highly important to make sure of the gestures and body language that may not offend them. They prefer dealing with managers and upper level management. CULTURAL DIFFERENCES IN DENMARK AND THEIR IMPACT ON INTERNATIONAL BUSINESS DEALS: Cultural differences can have their negative impact on the success of a business. It is highly important to understand and address these cultural differences to avoid the failure. Different cultural differences have been observed in Denmark which should be taken into consideration to address different problems. Misunderstandings and Misinterpretation: Different problems can occur if the flow of information is hindered by different barriers in communication (Hofstede, 1982). As a result, misunderstandings can occur between the two parties. Hence, to overcome this problem, one should make sure that both the parties understand and exchange information in the most easiest and reliable mode of communication and language. Similarly, misunderstanding can misinterpret the information which can further create conflicts and different problems between the parties. Team Ineffectiveness: Team ineffectiveness could lead towards lack of performance, lack of cooperation and low team morale (Bochner and Hesketh, 1994). It is better to understand the behavioral pattern and cultural competency of Denmark and its people to address these issues. It is important to infuse motivation, develop strong communication and appreciate the teamwork of the Danish employees. Other Intercultural Variables: Other intercultural variables such as religion, race and ethnic groups may become a cause of problem in hindering the process in Denmark. It is important for the company not to target the market or any specific group on the basis of religion or ethnic groups. Denmark is a home to different ethnic groups with people having different religious orientation and beliefs. Therefore, it is highly imperative for the company to address these issues on serious outlines to avoid any conflict in the future. CONCLUSION: Culture plays an important role in strengthening the roots of the society. However, it plays a key role in enabling the different organizations to enter in global market by acquiring the right knowledge about different cultural, cross-cultural and intercultural factors that can ensure the success of a business or how an organization can avoid different problems to avoid the failure of its international projects. A careful analysis of such factors is highly mandatory. List of References: Beaulieu, C. (2004). Intercultural Study of Personal Space: A Case Study. Journal of Applied Social Psychology, vol. 34 (4), p.p: 794-805 Cyborlink (n.b). ‘Brazil.’ < http://www.cyborlink.com/besite/brazil.htm> [Available Online] accessed on 8th January, 2012. Daniels, J., Radebaugh, L., Sullivan, D. (2007). ‘International Business: environment and operations.’ 11th edition. Prentice Hall. Bochner, S. and Hesketh, B. (1994) ‘Power distance, individualism/collectivism, and job-related attitudes in a culturally diverse work group’, Journal of Cross-Cultural Psychology, vol. 25, p.p. 233–257 Harrison, L.E. and Huntington, S.P. (2000). ‘Culture Matters: How Values Shaped Human Progress.’ Basic Books: New York Hofstede, G. (1982). Culture’s Consequences, international differences in work related values. Abridgeed. Newbury Park: Sage Publications. Wiseman, Richard L. (2003), "Intercultural Communication Competence", in: Gudykunst, William B (ed.), Cross-Cultural and Intercultural Communication, p.p. 191-208. Thousand Oaks: Sage Read More