As you consider this module’s text reading and your project idea, discuss your plan for addressing the global market. How does globalization affect your idea? Consider cultural, political, legal, ethical, and/or linguistic issues that may be different in other countries and affect how you do business.
Globalization is the interaction among people, companies, and governments of different nations in the buying and selling of goods and services. Traditional geographic barriers and cultural impediments are continuing to be broken down as companies seek business opportunities outside of their home countries. Faster communications, improved transportation means, and the continuing growth of internet usage are fueling the growth of global marketing.
As companies seek to expand their customer bases beyond their borders, the following are some factors to consider when evaluating potential international opportunities.
Culture encompasses the behaviors and beliefs of a given group of people. It influences their ideals for lifestyle and how they respond to a given set of circumstances. One of the most widely referenced approaches to analyzing culture comes from Geert Hofstede and is covered by Robbins and Judge (2009). This approach includes the following five dimensions:
- Power distance: The degree to which people in a country accept that power in organizations is distributed unequally. High power distance is indicative of a large distance or inequality between wealthy and poor, and a society that discourages upward mobility. Low power distance societies encourage equality and opportunity (Robbins & Judge, 2009).
- Individualism vs. collectivism: The degree to which people tend to act as individuals and value individual rights or act as a group in which the group looks after and protects its members (Robbins & Judge, 2009).
- Masculinity vs. femininity: A society with a high masculinity factor favors traits such as power, achievement, and control, and cultivates a strong division between men and women. A culture with a high femininity rating favors equality between the genders (Robbins & Judge, 2009).
- Uncertainty avoidance: Cultures with low uncertainty avoidance are less rule-oriented, take more risks, and more readily accept change compared to those in the high uncertainty category. These societies use rules and laws to reduce ambiguity and uncertainty (Robbins & Judge, 2009).
- Long-term vs. short-term orientation: Cultures with long-term orientation favor thriftiness, persistence, and tradition. Cultures with short-term orientation live in the moment, accept change more readily, and do not see commitments as an impediment to change (Robbins & Judge, 2009)
The political and legal environment can vary greatly among countries. Consider what type of government (democratic, totalitarian, dictatorship, communist) is in power within a targeted country and how that government’s behavior might affect international trade. Is bribery an accepted or expected factor with international trade? What specific import and export laws may affect business dealings?
The economic health of a nation can be a major factor in the success or failure of international commerce. What is the purchasing power of the targeted country? How stable is the economy? Is it growing, failing, or unstable?
Overall, the basic principles of value and exchange apply in the international setting. The application of marketing principles needs to center on the culture of the people. Consideration must also be given to the political, legal, and economic atmosphere and how these factors can shape the business landscape.
Robbins, S. P., & Judge, T. A. (2009). Organizational behavior (13th ed.). Upper Saddle River, NJ: Prentice Hall.