Global Operations Management Example

Global Operations Management Example Global Operations Management â€" Essay Example > Issues on Globalization HERE Global Operations Management FEBRUARY 13, 2008 TABLE OF CONTENTS What are some of the issues the host foreign country could face as a result of the expansion? 3 2.Explain what cultural barriers and diversity issues are commonly encountered by international/multinational (MNC) and global organizations 3 3. Why has diversity become such an important topic in the international arena? 5 4. What can occur when issues related to multiculturalism and diversity are ignored in an international company? 5 5. Describe at least 2 political and 2 economic issues that may arise during global expansion and proposed methods of addressing them. 6 6. Explain the importance of and the implications of each of these items PPQ Partss expansion plans to Germany and Japan. 6 References 8 Issues on globalization 1. What are some of the issues the host foreign country could face as a result of the expansion? A company who wishes to enter the global market has several issues to be to be resolved. The Agriculture and Consumer Protection (ACP) suggests three major issues for consideration. Accordingly, these are: first, the company should have an intensive review of the market, that is a study of the external environment. PPQ must study the segments needed and determine if there is a need for intermediaries. PPQ should also think about whether the company will obtain the product or make it themselves. PPQ should also make a decision on investment and control â€"whether they will need to enter an agreement for a joint venture, acquisition or by exporting as a means of entering Japan or Germany. In addition, ACP identified strategies in entering a market. PPQ can easily enter a market if they have a superior product; if the have modifications to existing product; if the product availability is assured, if they have a lower price strategy, and their product adheres to total adaptability. In brief, they should know the weaknesses and strength of the company by having an in depth study of its own internal environment 2. Explain what cultural barriers and diversity issues are commonly encountered by international/multinational (MNC) and global organizations. The most common cultural barrier encountered by global organizations is the language barrier. A worker may be intimidated to speak to co workers or supervisors when he/she speaks little English. This barrier may be dangerous for the job. Morris, Carol, ( February 2002), a planning consultant, mentioned in his article that people in the construction are of greater risk of having accident on the job because of lack of understanding of safety standards. Morris and Etho Connect (2009)also cited cultural diversity that includes roles and status, personal space, body language and religion. Some culture prefers to have personal space distance when talking to someone, establish an eye contact and shown to have different negotiating styles. There are countries that still value their roles in society, like in some countries women, are still subordin ate to men. They are not comfortable working with American counterparts, or will not speak or look directly in the eyes. In the same way, males are not at ease with female supervisors. Morris also mentioned that in many cultures, personal space becomes a barrier. For in instance, Americans prefer to have about a space of about five feet apart when conversing while different cultures prefer to have their own personal space. Japanese and Germans desire to have more distance, while Arabs and Latinos want to get closer. PPQ managers should also understand body language because it can be interpreted in many ways, like some want to shake hands, others do not. Germans like shaking hands every time they meet with people and to address people cordially calling him Mr. or Ms. or Frau Dr. as titles are important to them. (Think quest) In some cultures, religion plays an important role. For example, Muslims have to pray three times a day, while others are not allowed to work on certain days because of belief. We also have to respect personal appearance of a person because hygiene, grooming, and eating habits vary from culture to culture. Morris said that Muslims may want to wear their headdress because of custom. Also, immigrants from India, Turkey or other countries eat a lot of spices thus emitting a body odor that is unwelcome to some. 3. Why has diversity become such an important topic in the international arena? Diversity has become an important topic in international arena because it is a manifestation of the changes in the world and in the market place. Understanding diversity of each individual brings high value to an organization and creates competitive advantage and increases work productivity. Accepting cultural diversity in the workplace creates a successful place to communicate and creating a work environment that includes everyone, assuring that everyone will be given fair treatment. It becomes a hot topic because lack of understanding on the diversity of everyone causes misunderstanding and problems in the workplace. Communication barriers may be a cause of lack of productivity, as someone interprets the words used in other way 4. What can occur when issues related to multiculturalism and diversity are ignored in an international company? Several issues might occur when multiculturalism and diversity are ignored in an international organization, and according to Gagnon, Mathew (2007), its effect to the company are “ineffective employment of company resources, ineffective realization of organizational objectives and general loss of competitiveness. When multiculturalism and diversity are ignored in the company, Gagnon said, in his study, that employees feel undervalued, and less innovative. 5. Describe at least 2 political and 2 economic issues that may arise during global expansion and proposed methods of addressing them. International companies face political and economic issues during global expansion. An example of this is the political risk that can be defined as losing money due to changes that occur in a country’s government. Christy, John (2012). Examples of political risks are war, military coups or threats of terrorism or even threat of expropriation of assets. Political risks may also be thru changes of a new president or ruling party, or amendments or new legislations. These, I believe, are interrelated with economic issue, as these changes can have a big impact on the country’s profitability and the way investors feel about the prospects of the country. Proposed method of managing political risks. Managing political risks is difficult to assert and quantify. To start with, John Christy suggested studying country briefings because it has a lot of information that includes the country’s economy, government and politics. Also, it is better to keep in mind, if there is an impending national elections, company should know the parties involved and its economic policies because these parties may have diverse policies with the company’s own beliefs. As political risks cannot be totally ignored, one suggestion that matt ers in global expansion is not to put all your eggs in one basket, meaning, the company should learn to diversify and to invest in other countries as well so that it would not hurt so much if the company had miss the political calculation. (John, Christy) 6. Explain the importance of and the implications of each of these items in PPQ Partss expansion plans to Germany and Japan. It is assumed here that PPQ is a U S based company, and it has plans to enter Germany and Japan. Although a lot of Japanese are now well versed with the English language, language is still a barrier. The way they communicate may be interpreted to several meanings. An exchange of calling cards to them is the start of a business transaction, and so, one should take care of it, as it is means disrespect if one should write on it or simply put it away. Several customs have to be studied in order to have good business relations with Japanese and the implication of not understanding these is poor business relations and unfortunate impressions from the Japanese people. PPQ would not like to lose the trust of the Japanese people and its business just because of miscommunication. PPQ will have to deal with communication problem in Germany because according to Think Quest (1998), not all Germans know how to speak English, and even if they do, they are not comfortable in using it. So, the implication here, is that there will be a need for PPQ personnel to learn German language for smooth transaction References ACP - Agriculture and Consumer Protection (n. d. ) Chapter 7 Market Entry Strategies. FAO Document repository Retrieved 11 February 2012 http: //www. fao. org/docrep/W5973E/w5973e0b. htm Christy, John, 2012. Understanding and managing political risks. About. com. International Investing. Retrieved 10 February 2012 http: //internationalinvest. about. com/od/globalmarkets101/a/countryresearch. htm Ethno Connect (2009). What is cultural diversity? Ethno Connect. com. Retrieved 11 February 2012 http: //www. ethnoconnect. com/html/articles_01.html Gagnon, Mathew 2007. Managing Diversity for Global Businesses: What Will A Successful Program Look Like? Kausiki Mukhopadhyay Workforce Diversity in International Management â€" Spring Interterm 2007 Retrieved 11 February 2012portfolio. du. edu/portfolio/getportfoliofile? uid=8262 Morris, Carol. (2002) Cultural and language barriers in the workplace. 2002. Charlotte-Mecklenburg Workforce Development Board. retrieved 11 February 2012 www. charlotteworks. org/clbpositionpaper. pd Think quest. (1999) Introductions and meeting people. Oracle. Think quest Retrieved 11 February 2012 http: //library. thinkquest. org/26576/introductionpage. htm