Cultural Issues in National Problems Essay

* Based on your study on this module of cultural theories, international business ethics and the practice of managing across cultures, and assuming the role of a business consultant specialising in cross-cultural issues, write a cultural briefing for the Human Resources department of a real international business. Your briefing should cover a range of cultural issues, including the creation of cross-cultural teams, training employees for expatriate assignments, national negotiating styles and training employees for the challenges of cross-cultural management. This assignment may take the format of a report or a more creatively designed briefing document. Creation of cross-cultural teams Train employees for challenges of cross-cultural management National negotiating style The Chinese Negotiation http://www.globalnegotiationbook.com/John-Graham-research/negotiation-v1.pdf Negotiating in China: 10 rules for success http://www.forbes.com/sites/jackperkowski/2011/03/28/negotiating-in-china-10-rules-for-success/ pp. 163 note However, china is also a difficult and risky market for western business communities to operate in. the surprises, disappointment, and frustration on the part of western business people are not strange. China is a special challenge: it is the world’s largest emerging market, largest communist bureaucracy and oldest culture. These unique features make china a unique case in international business that calls for special academic and managerial attention. Now that china has reached and agreement with the European union and United States of America about its membership in the world trade organization (WTO), the importance of china as a trade partner is going to increase further. Question: * What are the meaningful stages of the Sino-western business negotiation process? * What are the main contentious issues in the formal negotiation sessions? * How can we understand chinese negotiating style observed in various stages from the chinese culture point of view? Ping-Pong model 1, pre-negotiation (lobbing, presentation, informal discussion, and trust building) 2, formal negotiation (task-related exchange of information, persuasion, concession and agreement) 3, post-negotiation (implementation and new rounds of negotiations) The Chinese show keen interests in getting to know the other party during these initial contacts. They try to ascertain whether or not the foreign firm has (1) the most advanced technology required for the project; (2) the willingness to sell or transfer it to the Chinese side by way of, for example, joint venture; and (3) the capacity of delivering the products on time. As one chinese negotiators explained: â€Å"our intention is to import the most advanced technology and to cooperate with large, world-famous foreign companies, because the life cycle of a technology is short. We pay even more attention to the supplier’s houjing(reserve strength) for continuous technological development lobbying: lobbing before the chinese government authorities is one of the most important marketing activities facing foreign firms that want to sell large industrial projects in chinese key industries like telecommunications. Foreign firms must convince the chinese that they have cutting-edge technologies that suit chinese government’s priorities, that they have long-term commitment to the chinese market, and that they are financially strong. They must present a highly reliable image before the chinese, making them feel safe to do business with them. The chinese said that they liked to do business with â€Å"big mountain† like Ericesson that they could trust and rely on in the long term. Presentation: giving attractive and reliable presentations to let potential chinese partners know the company, products and negotiating team members, is an important step toward formal negotiation sessions. Presentations aim to convince the chinese of the sincerity of the company in doing business ith china and show the chinese that the company’s products are and advanced technology with high quality and reasonable price. Foreign firms need to present themselves and their technologies to number of authorities. Very often one has to endlessly repeat the same things to different negotiators who may suddenly, without explanation, be replaced by another team. From chinese point of view, it is done to check the reliability and firmness of the supplier. Informal discussion: initial and informal discussions with chinese organizations often occur directly after the presentations Trust building: the chinese attach great importance to trust building in business negotiations. Formal negotiation * Equity share * Contribution of each party * Management control * Technology * Price * Persuasion * Concessions and agreement Post-negotiation * Managerial implications * Priority * Patience * People the PRC condition (guoqing) is a contemporary social and institutional factor influencing the PRC Introduction Hotel Chocolat is a famous luxury chocolate producer in the UK. It has 55 stores in the UK and 5 stores in the USA and the Europe. (Hotel Chocolat, 2012) The mainly product series are Giant Slabs, Selectors, Sleekster Selections, Liquid Chocolat, The Purist and Coco Juvenate Beauty Range. (Hotel Chocolat, 2012) Hotel Chocolat insists a high quality strategy so that their products are in luxury level, which attracting consumers come back again and again. Now Hotel Chocolat plan to expand the business and brand perception, managers think about enter Chinese market. In China, middle class improving their purchasing power in recent years, within urban residents has more disposable income (Farrell D, 2006). If manager decide to enter China market, human resource management (HRM) department needs to prepare three points, firstly is create cross-cultural team with Chinese employees, secondly is train the British employees for challenge of cross-cultural management, thirdly is negotiating st yle with Chinese. Creation of cross-cultural team and the challenges of cross-cultural management Cross-cultural team is necessary. Nowadays, the globe business activities are an important part of the worldwide economy. Many of different nationality works in one company or even in one group. In this case, Hotel Chocolat will be suggested to build a cross-cultural team within Chinese employees. This program can avoid some potential risk in Chinese market. Here will point out three directions. 1. Language In business group need to keep will communication to reduce the cost of information. Hotel Chocolat is British company so that the English is mainly language. But Chinese employee’s native language is mandarin and Cantonese, which make conversation maybe difficult. Fortunately, Chinese education department push English language teaching from primary school to college. Nowadays, the world’s most populous nation will become the world’s largest English-speaking country, account about two billion people are learning or have learned English (Clifford. C, 2009). Firstly, English level is an important testing standard when manager selects Chinese employees. Secondly, English employ which will work in China suggest to learn basic daily Mandarin. Of course, if possible, Hotel Chocolat should better choose the people who interested in China. 2. Build Virtual Team In the beginning, Hotel Chocolat should build a quickly communication tunnel between the UK and China department. For a high efficiency, Hotel Chocolat has to build Virtual Team. Virtual Team is basic on advanced information technology to link the geographical dispersion essential employees. It also downsizes the department in China and improves productivity.(Townsend, A, M., and Demarie, M, S and Hendrickson R, A., 2003) Why build a Virtual Team? Here point five factors: (Bettis, R and Hitt, M., 1995) * The flat organizational structure is becoming a good solution to increasing speed to communicate. * The competition and cooperation will be easy in globe economy environment. * Changes in workers expectation of organizational participation. * Adjustment the production of knowledge work environments. * Make trade and corporate activity easily. First of all, to build virtual team needs to pay attention to define the team’s function and organizational roles, build the technical systems to exchange the information. Define the team’s function and organizational roles are the most important thing. The UK and China have seven (DST.) or eight (GMT.) times difference, it make the working time harder. The manager in China who leads the virtual team should clear expectations about team’s performance and criteria. Because of the virtual team’s geographical dispersion, the manager can define the detail of daily report, working schedules and emergency solution. As a new market competitor, Hotel Chocolat will face many difficult, so the virtual team members in both side, the UK and China, have responds to meet online in a short time. In the same time, the virtual team in China needs to have individual ability to control and solve problems. A well communication system in virtual team is a strong support. The technical system should be designed basic on efficiency. One of the reasons is the virtual team members are in different place so that they cannot face to face. If people cannot face to face meeting, some serious and complicated issues will not solve well. In tradition way, the tools have online meeting (Skype), file upload and download (email). If possible, the technical system can use wide-angle camera to build a multiplayer video session, in the meantime, virtual team members can use â€Å"cloud system† to modify the same file in different place together. Within modern technical system, the virtual team becomes more reality and efficient. National negotiating styles When a company enters new market, an excellent negotiating skill will make their process more successfully. In business activities, communication is the key of make a good deal. Within a group of well training negotiating employees, the new market risks, not only China market, will be reduced. As the human resource department, they should make a plan to lead the negotiators’ mind set. Therefore, the â€Å" Ping-Pong† Model (Fang, 1999) is a good choice. (Fang, 1999) The â€Å"Ping-Pong† model is based on the international business negotiating style and Chinese business negotiating style (Fang, 1999; Frankenstein, 1986; Ghauri and Usunier, 1996; Graham and Lin 1987), fang tries to build a bridge between China and the world. In the â€Å"Ping-Pong† Model, there are two major parts. One is the stage of the Sino-Western business Negotiation process and the other one is the dimension of Chinese business culture. In 1996, Ghauri make a structure of the international negotiating style process. He divides the total negotiation into three parts: 1, Pre-Negotiation 2, Formal-Negotiation 3, Post-Negotiation And also Fang realized that in Chinese cultural situation, he also define three main thing: 1, The PRC Condition 2, Confucianism 3, Chinese stratagems Combine these two things, international negotiating style process and Chinese cultural situation, the â€Å"Ping-Pong† Model produced. Next part, it will analyze six factors of â€Å"Ping-Pong† Model. Pre-Negotiation It includes four processes, lobbing, presentation, informal discussion and trust building. In the beginning is lobbing, in China market the government is a powerful force to the market. So it is necessary to have a good conversation with government. Presentation and informal discussion is the base of trust building. In public ways, presentation can show company’s abilities to the company, in other ways, Informal discussion enhance mutual understanding between company and its potential partners. Formal Negotiation In formal negotiation stage, five major contentious issues needs to serious consideration: equity share, contribution of each party, management control, technology and price. For Hotel Chocolat, technology is the top secret so that the human resource department should focus on this part. Post-Negotiation After formal negotiation, the team should be prepared for Chinese trick. One Swedish negotiator recall that (Ghauri P. and Fang T. 2001) Chinese negotiator always take the old issue whatever and whenever, but these situation would not happened in European, Middle Eastern and African countries. Hotel Chocolat website, (2012), Store http://www.hotelchocolat.co.uk/Chocolate-Store-Locations-Achocolatestore/ (accessed: 8th Oct 2012). Hotel Chocolat website, (2012), Products http://www.hotelchocolat.co.uk/chocolates-CHC_PRODUCT/ (accessed: 8th Oct 2012). Farrell, D., Gersch, U. and Stephenson, E. (2006), The value of China’s emerging middle class, McKinsey Quarterly, pp69-69. Clifford Coonan, (2009) The largest English-speaking country? China, of course, The Irish Times, 6 June, available at: http://www.irishtimes.com/newspaper/weekend/2009/0620/1224249169396.html (accessed at 9th Oct 2012). Townsend, A.M., DeMarie, S.M., Hendrickson, A.R. (2003) ‘Virtual teams’ In Thomas, D.C. (ed) Reading and Cases in International Management: A Cross-cultural Perspective. London: SAGE, pp.269-281. Bettis, R. and Hitt, M. (1995) â€Å"The new competitive landscape†, Strategic management journal 16(S1), pp,7-19. Fang, T. (1999) â€Å"Chinese business negotiating style. Sage: Thousand Oaks, CA. Frankenstein, J. (1986). Trend in Chinese business practice: Change in the Beijing wind. California Management Review, 29(1): 148-160. Ghauri, P. N. and Usunier J. –C. (1996) International Business Negotiations. Oxford: Pergamon. Graham, J. L. and Lin, C. –Y. (1987) A comparison of marketing negotiations in the Republic of China (Taiwan) and the United States. In Cavusgil, T. (ed. Advanced in international marketing (Vol. 2, pp. 23-46). Greenwich, CT: JAI Press. Ghauri P. and Fang T. (2001), Negotiating With the Chinese, Journal of World Business Vol. 36, pp. 303-325.