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CASE STUDY 1 Communication

Before reading:

• How common do you think intercultural management problems are nowadays?
• Are they harmful for the company, employees and managers?

Today's businesses and management are quite complex due to the globalization and to the fact that in a company there might be several people from several different backgrounds and variety cultures. But still, the most important thing in order to manage well is to Communicate and have the need for communicate well to each other and most importantly have an effective intercultural communication between co-workers. This is why the management today must ensure that they are understanding and being understood across cultural boundaries. As I was working for the clothing company in Finland which did business with Italian company and ordered clothes from Italy there were several problems in communication and concepts.

So, The Finnish Company ordered clothes from Italy in their strict deadlines, ordering dates and expectations that the goods will be delivered on time. The manager told to two of our employees to make sure that the orders are done and delivered. The employees contacted the persons in Italy made examples of orders and agreed on the deadlines, due dates of the payments and delivery dates. Everything was well. But when the delivery date came, no goods were delivered or even sent from Italy yet, despite the fact that in Finland the supplier already had promised the goods to be in the boutique for customers. The manager in Finland blamed the two employees for not doing their task well and contacted the people in Italy.

After a while the Finnish manager came to Italy to sort out the issue, he wanted to go straight to Business and talked about the orders when the Italians wanted to have a dinner and take the time to get together first. The Finnish manager upon arriving back home explained to his employees how rude the Italians were because they came physically very close in the meetings and didn’t stick to the point. All the situation was chaotic and the cultural differences were too much for the Finnish manager. He had been used to do business only in Finland before and didn’t have a clue how different the business between two different countries can be. This situation kept on going because the Finnish manager didn’t want to change his habits and the Italians didn’t even know that something was wrong.

Questions

1. Finland blamed the two employees for not doing their task well. Who do you think should be blamed?
2. Judging from what the Finish Manager thought of his Italian partners, how would you characterize the Finns and Italians, their attitude to business and their communication style?
3. What solution would you recommend to the situation described in the text?
4. What the global message concerning the intercultural problem does the author convey?

Vocabulary

1. Look at these adjectives most commonly used to describe a company culture either in an attractive or negative way. Put these adjectives next to the right description.

1. Family-Oriented - employees are offered benefits and flexibility that make it easy to find balance.
2. _______________ those who exceed expectations are recognized, even in non-monetary ways.
3. _______________ employees work well with one another, within and between departments.
4. _______________ the organization supports employee growth and development; gives employees clear feedback and suggestions before moving to termination.
5. _______________ the company is always seeking new ways to stay a step ahead of the industry and is open to feedback and ideas.
6. _______________ employees have both the freedom and accountability to change their workplace and their results.
7. _______________ diversity is welcomed and appreciated.
8. _______________ employees walk on eggshells to avoid being targeted by toxic employees and managers, who are never addressed.
9. _______________ the direction of the organization (or expectations on staff) change with the wind.
10. _______________ employees are expected to meet unrealistic demands and expectations.
11. _______________ flexibility is non-existent; work hours, setting, and processes are already established and employees must conform.
12. _______________ the CEO demands to be included in the selection process for a receptionist six levels below him/her in the organisational chart.
13. _______________ employees are reprimanded (or even fired) for the first transgression rather than corrected and guided.

Writing (at least 150 words)

Choose the organisation you know well and describe its company culture using the new words.

CASE STUDY 2

«Communication Gap»

(Harvard Business Review) 

The Steelman Company was a large concern making many types of equipment for the armed forces of the United States. It had over 20 plants, located in the central part of the country, whose purchasing procedures had never been completely coordinated. In fact, the head office of the company had encouraged each of the plant managers to operate with their staff as separate independent units in most matters. When it began to appear that the company would face an increasing difficulty in securing certain essential raw materials, Mr. Manson, the company’s president, appointed an experienced purchasing executive, Mr. Post, is a Vice President in charge of purchasing, a position especially created for him. Mr. Manson gave Mr. Post wide latitude in organizing his job and he assigned Mr. Larson as Mr. Post’s assistant. Mr. Larson had served the company in a variety of capacities for many years, and knew most of the plant executives personally. Mr. Post’s appointment was announced through the formal channels traditional in the company, including a notice in the house organ published by the company.

One of Mr. Post’s first decisions was to begin immediately to centralize the company’s purchasing procedure. As a first step he decided that he would require each of the executives who handled purchasing in the individual plants to clear with the head office all purchase contracts, which they made in excess of $10,000. He felt that if the head office was to do any coordinating in a way that would be helpful to each plant and the company as a whole, he must be notified that the contracts were being prepared at least a week before they were to be signed. He talked his proposal over with Mr. Manson, who presented it to his Board of Directors. They approved the plan.

Although the company made purchases throughout the year, the beginning of its peak-buying season was only three weeks away at the time this new plan was adopted. Mr. Post prepared a letter to be sent to the 20 purchasing executives of the company. The letter follows:

Dear______:

The Board of Directors of our company has recently authorized a change in our purchasing procedures. Hereafter, each of the purchasing executives in the several plants of the company will notify the vice president in charge of purchasing of all contracts in excess of $10,000 which they are negotiating at least a week in advance of the date on which they are to be signed.

I am sure that you will understand that this step is necessary to coordinate the purchasing requirements of the company in these times when we are facing an increasing difficulty in securing essential supplies. This procedure should give us in the central office the information we need to see that each plant secures the optimum supply of materials. To this way the interests of each plant and of the company as a whole will be best served.

Yours very truly

Mr. Post showed the letter to Mr. Larson and invited his comments. Mr. Larson thought the letter as an excellent one, but suggested that, since Mr. Post had not met more than a few of the purchasing executives, he might like to visit all of them and take the matter up with each of them personally. Mr. Post dismissed the idea at once because, as he said, he had so many things to do at the head office that he could not get away for a trip. Consequently he had the letters sent out over his signature.

During the following weeks replies came from all except a few plants. Although a few executives wrote at greater length, the following reply was typical:

Dear Mr. Post:

Your recent communication in regard to notifying the head office a week in advance of our intention contracts has been received. This suggestion seems a most practical one. We want to assure you can count on our cooperation.

Yours very truly

During the next six weeks the head office received no notices from any plant that contracts were being negotiated. Executives in other departments who made frequent trips to the plants reported that the plants were busy, the usual routines for that time of a year were being followed.

What Questions for oral discussion:

1. What is an Effective Communication?
2. What are the reasons for poor communication in the workplace?
3. What are the advantages and disadvantages of open communication?
4. What are the ways of improving communication at work?
5. What examples of good or bad communication can you give?

*Additional Task (Optional) / 3-Minute Pitch:

«The Effects of Poor Communication in Business»

Case Study 2: International markets

Before reading:

• What countries do the most popular brands of beer come from? Do you know any beer brands in the Asian market?
• What do you think customers expect from a foreign beer and want to experience by purchasing it?

Paul Kurucz

Golden Lucky Beer is a new brand of Chinese beer. It is being created to compete with famous brands of Chinese beer such as Tsingtao, Zhujiang, and Yanjing. Creating this new brand is Chao Zhang, a Chinese-American living in California. Chao had noticed that Chinese beers are not very popular yet in North America. He sees an opportunity for a new Chinese beer brand to enter the North American market.

Chao first discovered the opportunity when he was in a Chinese restaurant in Los Angeles. At that time his parents and some aunts and uncles were visiting him. They lived in China and were on a two week holiday in America. In the restaurant Chao and his family sat around a large round table, which is a typical seating arrangement in China.

His father asked the server what kind of beers the restaurant offered. This was an unusual request because no-one in the family knew he liked to drink beer. The server in the restaurant noted that they had local American brands available and one Chinese brand beer, Tsingtao. Chao's father preferred the Yanjing brand, but it was not available, so he ordered a Tsingtao beer. Much conversation followed the family's discovery that he enjoyed beer. They pushed him to explain his revelation. The family fell silent as Chao's father said this:

"It is time for us to express our pride in our country and the many wonderful original products we create, not just those designed and engineered by Westerners. Our beer, for example, is as good as the rest of the world's. I now drink Chinese beer wherever I go in the world."

Again, much conversation followed this pronouncement. While the family spoke, Chao looked around the restaurant. Of the 20 tables with customers at them, some 5 were being occupied by non-Chinese guests. 4 tables had typical Caucasian (white) people, and 1 had an Indian family, as evidenced by the fact that Chao could hear them speaking Hindi at their table.

The rest of the tables were being occupied by Chinese or Chinese-American guests.

At only 2 other tables was someone drinking beer: Those of two Caucasian families. At one table a man was drinking an American beer brand called Coors. At the other, both a man and woman were drinking Tsingtao beer.

At all the other tables, whether they were occupied by Chinese or non-Chinese guests, tea, soft drinks, or another type of alcohol had been ordered.

Chao wondered why Chinese beer was not as popular in this restaurant as the famous Mexican brand, Corona, might be in a Mexican restaurant. Or the Indian beer brand, Kingfisher, might be in an Indian restaurant.

Later that week, Chao visited two more Chinese restaurants and noted the same pattern: People did not drink much beer in a Chinese restaurant. When they did drink beer, it was an American beer or it was a Chinese beer. He tried a Tsingtao beer himself at one of these restaurants and found it tasted excellent. He thought it tasted similar to American brands.

Chao had just graduated with an MBA degree from the University of California. He knew that getting rich in America would likely come from being an entrepreneur – starting his own business. Chao had some money to invest and did not yet have the responsibility of a wife and children of his own to support yet. He decided to explore why Chinese beers were not popular and if he might have found a largely unexploited marketing opportunity: Importing and selling a new brand of Chinese beer in North America.

His research excited him and resulted in the decision to create his own new brand of beer, which he named "Golden Lucky Beer".

Questions:

1. Why do you think Chinese beer was not as popular in this restaurant as the other national brands might be in authentic restaurants?
2. What logical possible segments emerge from Chao's observation in a restaurant?
3. What marketing channel(s) should Chao use for his product and target market(s)?
4. Make specific marketing recommendations to help Chao successfully launch his beer brand in North America.

Vocabulary

Make phrases by matching an item from each column. Then complete sentences below.

1. More may be spent on promotion in the first year to build awareness of a new product or service, for example.
2. This technology is often used for advertising research to___________________________________.
3. Most PR professionals subscribe to the principle that you only _________________ when you have real news.
4. Perhaps you don’t have the money _____________________ or rent space on a billboard. Branded clothing, however, can be a great investment.
5. One way to ______________________________, new and old, is through social media platforms.
6. To ______________________, introduce unique thing, survey the market, consider your budget, test your product, promote your product, and take feedback from customers.

CASE STUDY 3: Building relationships

Before you read:

• What happens if mutiny occurs in one of the department? How does it affect the company’s morale?
• Should a manager allow a customer and possibly the firm to be hurt in order to develop subordinates’ experience and abilities?

G. Scott Erickson

Alan, a lead supervisor in the manufacturing department, has just received word of an altercation between one of his junior supervisors, Bob, a recent college graduate, and Coot, a veteran machine operator.

Bob’s group had been working on an order for a major customer. Bob had set up a work schedule and job assignments which Coot, through experience, knew would not get the order out on time. Coot suggested a different sequence which Bob dismissed without discussion. The group began the order using Bob’s setup, but Coot switched everyone over the minute Bob left the area. The order was finished, on time, without further incident. Bob later discovered the “mutiny,” however, and had a loud confrontation with Coot in front of the entire group.

Alan has reviewed the two work schedules and, indeed, Bob’s assignments would not have gotten the order out on time. Since the customer uses a Just-in-Time inventory system, such a slip-up would probably have cost Alan’s company any future business with the customer.

On the other hand, Alan knows that a failure to support Bob will cause an immediate loss of credibility throughout the entire department. Bob needs the freedom to make his own mistakes if he is to develop and gain experience, but at what cost to the customer?

Questions

1. What are Alan’s responsibilities to customers? How should these responsibilities be balanced against Alan’s responsibilities to develop supervisors and to ensure discipline?
2. Does Coot have a right to do his job so as to accomplish the company’s goals?
3. Does Bob have a right to learn his job without constant second-guessing from his supervisor and his fellow employees?
4. Which parties will benefit and which will suffer if Alan supports Coot? If he supports Bob? Is this distribution of benefits and burdens fair?
5. What are short-term and long-term alternatives?

Vocabulary

Complete the gaps with the underlined words and expressions from the text. Some words are extra.

1. The draft resolution will only intensify the confrontation rather than solve the issue.
2. You have landed a temporary job and you are going to be starting your first day of your new ___________________ soon. You want to be successful.
3. Some creditors, such as ___________________ or suppliers, may prefer continued business with the debtor to rapid repayment of their debt.
4. Whether on the manufacturing floor or in the office, I can switch gears quickly to ________________________.
5. The first lapse, the first _____________ in your work, and I will use it to fire you.
6. The result of the vote poses a serious challenge to the government's _______________.
7. According to witnesses, the _______________ between the two men started inside the restaurant.
8. Now I have _________________ and I've made a list of transport liaison managers.
9. ___________________________ processes on integrated supply chains have also made it possible to control the quantities supplied in a more sophisticated manner than before.
10. In the armed forces, to proceed with such a position against one's commanding officer is recognized as ________________.

MARKET LEADER / Upper-intermediate 3rd ed. BUSINESS BRIEF

Unit 1: COMMUNICATION

Within companies, communication falls into two main areas. There is the communication of information and technical knowledge needed to do the job at hand. Here, paper-based communication is being replaced by the company intranet, with internal company websites only accessible by employees. Some very large companies are appointing knowledge officers to exploit the information in a company to the full and facilitate its communication to those who need it. (But in this age of increasingly accessible information, there will no doubt always be the information hoarders, employees and managers who find power and pleasure in keeping information for themselves, even if it would be useful to their colleagues).

There is also what might be called 'celebration-exhortation'. The internal company magazine is the classic communication channel here. It may be produced in-house by a 'communications department' or out-of-house by journalists who specialise in this area. It may try to demonstrate how the company is putting its mission statement into action: the management may try to change employee behaviour by exhortation and by praising the performance of particular departments and individuals.

Externally, advertising has been the most visible form of communication with customers. Usually this is designed to increase product sales, but there is also institutional advertising designed to improve perceptions of the company as a whole. Companies naturally like to be seen as human and environmentally aware. But the communication between companies and their customers is increasingly becoming two-way, with customer service centres designed to gather information, not just complaints, from customers about all aspects of use of a company's products. Ideally, this information feeds back into product modification and new product design. Additionally some companies are now using social software and micro-blogging sites such as Facebook and Twitter to communicate with their customers.

Equally, a company must communicate with its investors, and investor relations are becoming an important specialised area of public relations. Investors want to know how their money is being used and what their prospects are.

Then there is the wider public audience to attend to. Press conferences may be called to announce important events such as product launches. Press releases may be issued to communicate more routine information. There is also the specialised area of crisis management and damage control.

Whatever a company does, it has an image, so it should try to influence (some would say 'manipulate') the moulding of this image. This is one reason why the communications industry, in all its forms, is a multibillion-dollar business.

Discussion questions:

1. What makes a good communicator? What factors are important for communication?
2. What forms of communication are popular in companies today?
3. How do companies converse with customers?

UNIT 2: INTERNATIONAL MARKETING

‘The world's youth prefer Coke to tea, trainers to sandals,’ wrote one marketing specialist recently. This implies that tastes everywhere are becoming similar and homogenous. But the watchword should still be 'Think global, act local'. Acting local means having local market knowledge: there are still wide variations in taste, customs, behaviour and expectations between consumers in different markets, even markets that from the outside look very similar, like those in Europe. It means, for example, recognising attachments to local brands, how business is done in each place, and so on.

Of course, these are issues that a company with a global presence has to address. But even companies that seem as if they have been global forever had to start from a home base. For example, it took Marlboro 30 years and McDonalds 20 years to become truly global organisations.

How to enter overseas markets in the first place? Philip Kotler enumerates the various methods:

• Indirect export: Exporters use an intermediary such as an export agent to deal with buyers in the overseas market.
• Direct export: Companies handle their own exports, for example, by setting up overseas sales offices.
• Licensing: Companies sell the rights to use a manufacturing process, trademark or patent for a fee or royalty. In services such as hotels, the company may negotiate a management contract with a local business to run the hotels on its behalf.
• Joint ventures: Two companies, for example an overseas firm and a local one, may work together to develop a particular market.
• Direct investment: The company buys a local firm, or sets up its own manufacturing subsidiaries.

Of course, these different arrangements involve different levels of commitment, investment and risk. Kotler talks about the internationalization process, where firms move (hopefully) through these stages:

Stage 1: no regular export activities

Stage 2: export via independent representatives/agents

Stage 3: establishment of overseas sales subsidiaries

Stage 4: establishment of production facilities abroad

This process will help them to progress towards global thinking and local action as they expand internationally. At different stages, companies will have different levels of understanding of the markets where they are trying to develop. Each step in the process requires different levels and types of support.

Discussion questions:

1. What problems may companies face when they try to internationalise a brand? How do companies enter overseas markets?
2. Define the stages of internationalization according to Philip Kotler. How companies can build strong business relationships?
3. How would you prepare for a business trip to a country you had never visited before?

UNIT 3: BUILDING RELATIONSHIPS

When someone works for an organisation, employers and employees have expectations about what is reasonable behaviour in a work context. There is a certain level of trust between people, and even if the news is full of stories of breakdowns in this trust, we think of them as exceptions to established norms in social relationships.

Business-to-business relationships

Networking events can be a good way to make new contacts - in some industries, trade shows are ideal for this. Some say that first impressions count. Others think that someone's character can only be judged after a lot of contact in business contexts and socially. This is why deciding on a supplier or distributor takes varying lengths of time in different cultures. To emphasise the importance of relationships like these, companies may refer to each other as partners.

When firms work together on a particular project, they may enter into a strategic alliance. This may take the form of a joint venture between two or three companies, or a consortium between several organisations. An alliance may be the prelude to a merger between companies. Journalists often use the language of betrothal and marriage to describe situations like this.

Companies may overcome legal and other barriers in order to merge, but, as in marriage, there is no guarantee that the relationship will work and last. The cultures of the two companies may be so incompatible that the promised increase in profitability and shareholder value does not materialise.

Relationship networks

Stakeholder theory holds that society is made up of a web of relationships, and that each member of this arrangement has its stake of interest and of responsibilities. In a company, the interested parties are its owners (shareholders), managers, employees, suppliers, distributors, and customers, who may or may not be end-users of its products or services. A large company's activities have an effect on the places where it operates (think especially of company towns dominated by one company) and on society as a whole. Some companies publish an independent social audit that goes beyond the traditional annual report and attempts to give a bigger picture of the company's place in society, the benefits it brings, the effects of its activities on people and the environment. Some say that social audits give a false sense of social responsibility. Optimists reply that pressure from stakeholders such as shareholders and customers can bring positive changes in the way companies work, and benefits to society as a whole. Companies are increasingly sensitive to accusations of causing pollution, tolerating racism or using sweatshop labour. Companies are increasingly aware that their overall image, negative or positive, will

eventually be reflected in their share price, an ultimate indicator of building good relationships, not just commercial ones.

Discussion questions:

1. How can companies build strong business relationships? What kind of B2B relations can companies enter?
2. What are the benefits and drawbacks of the Stakeholder theory?
3. A foreign company is opening a branch in your country. What factors should it consider?