跨国公司的发展目标与发展前景的留学生assignment

国际性经营公司的数量正在不断增加，世界为不同国别的公司而开放，，也包括因公司业务不断增加而制定的新目标。

因为竞争越来越激烈，公司在海外的经营与以前相比会面临着一项更艰巨的任务。

当公司正面临国际性挑战时，公司处理问题的方式肯定是新的且不熟悉的。公司从未面对过的障碍在每天的工作中变得至关重要。文化是其中的一个障碍,会影响整个合作计划。

文化可以以不同的方式影响业务，例如语言问题、定价问题和文化冲突，这些并不罕见,尤其是在开始阶段。

公司必须能够采取双赢的方式处理这些困难。错误很难纠正，若不尊重国外文化也摧毁整会个操作。

有一些笼统性建议，公司始终必须记住：在国际市场上的合作上要三思而后行，这是很重要的；甚至公司进入国外市场之前，要了解新文化中当地的个人礼仪和习俗。如果第一印象变得消极，那么之后就会面临很多困难。外国文化在商务谈判中以不同的方式表现出，例如当谈到提前计划和交货时间的时候。

文化既可以带来积极影响，也可带来消极影响，许多在国外发展的公司都被困在新的国外环境。

要记住的重要事情是，外国文化不是我们家里的寒暄和只在对外谈判开始前才着手准备的，要尊重和理解新的文化且没有迫使把我们自己的信仰强加到他人身上，这对公司发展绝对有帮助的并且是值得考虑的事情。通过学习东道国的语言，可以更容易赢得对方的尊重和信任,可以获得竞争优势。

The number of companies operating internationally is growing constantly. The world is opening up for foreign firms and new destinations in the company′ business are increasing.

Because of high competition the companies operating abroad are faced with a much larger task then before.

When going international the challenges the company must handle are new and unfamiliar. Obstacles the firm never faced before are becoming crucial in the every day work. Culture is one of these obstacles and can affect the entire co-operation.

Culture can influence the business in different ways. Language problems, pricing difficulties and culture collisions are not uncommon, especially in the beginning.

The company must be able to handle these difficulties in a way that is satisfying also for the other part. Mistakes can be difficult to correct and disrespect for the foreign culture can destroy the entire operation.

There are some general advices the company always must have in mind before and during a co-operation on the international market. It is important, even before entering the foreign country, to inform the personal about the manners and customs in that new culture. If the first impression becomes negative, this can be hard to shake. Foreign cultures have different ways of doing business, for example when it comes to planning ahead and keeping delivery times.

Culture can be both a positive and negative influence and many companies are struggling in the new and foreign environment.

The important thing to always have in mind is that the foreign culture is not as we are used to at home and to be prepared before starting the new foreign operation. Respecting and understanding the new culture without forcing our own beliefs on people, are things that can be extremely helpful to consider. By learning the host country’s language, can respect and trust more easily be won, and competitive advantages can arise.

 前言—Foreword

We would like to thank the following persons for their help and time during the making of this essay.

First of all, we would like to direct a special thank you to our professor and examiner,

MISS LATIFA. Thank you for participating in this essay with both time and sharing of experiences.

We hope that everybody will enjoy reading this thesis!

论文提纲—Thesis outline

This thesis is compounded of many chapters, which are presented below in figure 1.This thesis starts with explaining the background of the study and then this background is narrowed down to a problem analysis.

In chapter two we opted different theories that are based in the research question and are about culture and price negotiation. Chapter three deals with the research methodology, including pre-understanding, qualitative research, scientific approach, data collection, data analysis, validity and reliability. Chapter four includes the empirical findings, what we have found out from managers during the interviews. Chapter five is the analysis part of data collected from managers, Chile and Uruguay based on the experiences they gained from different project in these countries. As well, problems, recommendations and limitations are also given here for the future to improve the quality of research in this field.

论文主题陈述—Figure Theses statement

1.介绍— Introduction

This chapter creates interest for the thesis. We will present a background to the research area. The introduction further continues with a problem discussion which will lead to the purpose and research questions. Finally we present briefly the limitations of our approach.

1.1背景— Background

As most of you know the increasing globalization and internationalization has become of great importance recently. More and more companies start to look abroad to expand their businesses as the world becomes more and more interconnected. To manage business operations across international boundaries has become one of the largest challenges for international business today.

According to Root (1994) the global economy has formed business environments that require companies to look past the traditional thinking of the home market, and start instead looking at business from an international global perspective. The method a company ventures from their home market to new geographical markets is of great importance for how well the company succeeds with their business.

According to Osland et al. (2001), small and medium size firms that have taken the decision to internationalize and multinational companies that want to expand into foreign markets are both faced with the challenge of choosing the best structural arrangements.

Bennett (1995) discusses many factors that encourage companies to begin operating internationally. The most obvious are:

Hoped for economies of scale and scope.

Experience Curve effects resulting from increased outputs.

The possibility of the existence of beneficial markets in foreign countries that is not available at home.

We believe that the development in communication, improvement in travel conditions, lower tariff barriers and others have conduct foreign markets to be more accessible and have provided more opportunities for Swedish companies to go international. According to Dunning (1993) go international refers to various locations that contribute to value added activities. Root (1994) said that manufacturing and service companies enter international markets for several reasons. Some go in a foreign country because markets at home are: growing faster. Other companies may basically follow their home customers who are going international.

Since a high number of businesses from around the world enter the global market, firms need to be more specialize in order to sustain their competitiveness. The situation today for Swedish companies is not easy. There is a high level of competition between Swedish and foreign companies. This is one of the reasons to why firms should specialize and establish business operations abroad if they want to survive and grow. According to Slater (1968), the company must keep in mind that developing countries are very different from industrial developed countries. This fact becomes very important when it comes to entering a developing country’s market because developing countries for example often do not have a well functioning infrastructure and the population is many times poor and often spend a large part of their income on food articles. The political and legal issues also become an important part when it comes to entering the market. We elected the subject of our essay because we feel that these issues are of great interest to investigate. After some investigations we discovered that South America is a continent that have evolved fast and is still attracting more and more foreign companies. These countries were chosen because several of the largest cooperations that our selected company has conducted took place in these nations.

Thereby, a more specific and interesting question to analyze can be developed. How can a Swedish company improve its international business in South America?

1.1.1南美— South America

History teaches us that democracy and regional economic development help undergrad regional peace and stability. South America recently became a big and attractive market for foreign companies.

According to Arbelaez et al. (2000), South America and the Caribbean is a land full of promises and contrasts, where a head to head competition exists between globalization and nationalism, the haves and the have-nots, capitalism and communism, literature and high technology, markets and governments. All these characteristics took place in South America after the democratization in 1990. From this year forward a new business era for many international companies developed.

In South America the government today is the most important factor in the business environment, for a lot of foreign companies. Arbelaez et al. (2000), states that the role of governments is to provide the framework that will allow the private sector to create wealth.

We believe that in this continent the interest to invest in different industries is huge. The market is relatively attractive and open for foreign investors. Moreover, there are some other factors that make for South America a good investment goal, such as cheaper labour force and lower production cost.

1.1.2巴西— Brazil

Brazil is a very important investment country and is one of the largest economies in South America and the eighth largest economy in the world. It is the fifth –largest country by geographical area, the fifth populous country, and the fourth most populous democracy in the world (Wikipedia, 2008). It lives more than 190 million people in Brazil today and the per capita income is $9.700 (GDP: $1.838 trillion). This number of inhabitants and GDP are good indicators that testify that Brazil is a highly potential country for foreign corporations (CIA, 2008).

After some years with a protectionist economy, Brazil nowadays is open for foreign companies. More than 200 Swedish companies participate actively in the Brazil economy, with a turn over of $23 billon (2007) and they employ 50 thousands workers (Swedcham, 2008). For Brazil, the last decade was turbulent in context of the economy stability. This was the reason why foreign companies could not invest in Brazil earlier. Today, the rate of inflation in Brazil is 4.1 percent; and this is also a good indicator for worldwide companies to conduct business in Brazil (CIA, 2008).

1.1.3智利— Chile

According to Bennett (1995), Chile’s economy, compared to other economies in South

America is characterized by market-oriented economy as well as by a high level of foreign trades.

Chile is a country where 16 million people live, with an income per capita of $14,400 and

GDP $234.4 billion as well with 6.5% rate on inflation (CIA, 2008).

Chile continues to attract foreign direct investment, but most foreign investment goes into gas, water, copper, electricity and mining, agricultural industry (Maps of world, 2008).

Moren (2006) states that Chile is often the first stop for investors entering South America and its open and liberal economic model, installed in the 1970s, has been portrayed as an example to be followed for developing countries. Moren (2006) also states that Chile subscribes the bilateral free trade agreement with European Union, United States, South Korea, Canada, and currently holding negotiations to add India, China, Singapore and New Zealand.

1.1.4乌拉圭— Uruguay

Uruguay has a middle income economy, is to a great degree based on agriculture, (making up 10% of GDP and the most substantial export) and the state sector, and relies heavily on world trade (Wikipedia, 2008). During 1996-98 the averaging growth annually with 5%, but in 1999-2001 the economy suffered a major downturn. The economy has grown strongly since 2004 as a result of high commodity prices for Uruguayan exports, a strong peso, growth in the region, and low international interest rates (CIA, 2008). For the duration of 2007, GDP have been $ 37,05 billion, GDP per capita $ 10.700 and inflation rate 8,5 % (CIA, 2008).

The relationships between Sweden and Uruguay are good and comprise among others, the thoughts about FN questions. There are a few Swedish companies that have subsidiaries in Uruguay, for example Ericsson. Many Uruguay people escape from the dictatorship to Sweden, which contributed to strong cultural and emotional bounds (Regeringen, 2008)

1.1.5谈判— Negotiations

Rodgers(1998) states that cultural differences are well known for their impact on habits, and social activity. Nowadays we also start to realize this impact on organizations, planning, hierarchical relations and how companies negotiate with others internationally. One example on how negotiations can be different from what European countries are maybe not used to, can we find in the Brazil Carrier Guide (2008), about negotiations in Brazil. Here, the actual negotiation can many times take a really long time and trust, commitment and nurturing are issues that are required. Because of relatively new investments from foreign countries, Brazil has its caution and wariness left when dealing with foreign business people. Bargaining is a part of the negotiation process and leads to building trust and relationships. Rodgers (1998) says that especially in Latin countries, job and relationships goes hand in hand and power and status can often give the impression of mistrust.

1.1.6议价— Pricing

Price plays a key role in creating customer value and building customer relationship, as well is one of the four elements of the marketing mix and an indicator that affects buyer choice. Many companies today compete with each other with different prices in both the domestic and the international market. Price is the only element in the marketing mix that produces revenue; all other elements represent cost (Kotler et al. 2007).

Pricing is one of the most complicated decision areas encountered by international marketers. Market prices at the customer level are much more difficult to control in international markets than in domestic market. International pricing in general is more complex and critical than domestic pricing. According to Chee et al. (1998), the price is critical because it affects the firm’s ability to stay in the market. The price is also complex, because of the diversity of markets, with their different environment such as, political, legal, social, technological, consumer characteristics, etc. Thereby, we started to wonder if price is an issue that can affect the international business and the company’s co-operations in the foreign country.

1.1.7 公司展示—Company presentation

With more than 150 years tradition, Andritz is one of the most famous companies in machine and plant production sector. The company is a global leader for customized plants, systems, and service for pulp and paper, hydropower, steel and other specialized industries (solid/liquid separation, feed and bio fuel), (Andritz, 2008).

The Hungarian entrepreneur Josef Körösi, who was both the founder and a machine worker, started Andritz AG in 1852. After a couple of years the company expanded its production, such as cranes, pumps, and water turbines, later as well bridges, steam vessels, steam engine and mining equipment. After ten years foundation, the company employed 600 people, and in the 1870ies as much as 1.300 people. Today Andritz has about 12.000 employees and 35 product facilities and over 120 affiliates and distribution firms around the world. In South America the company operates on the Brazil, Chile, Columbia, Mexico, Uruguay and Venezuela market. The company′ headquarter is in Graz, Austria (Andritz, 2008).

The Andritz Group in the global markets operates in different business areas that can be seen in the model we constructed.

安德里兹业务领域—Figure . Andritz business areas

The above-presented model can be explained with help of Andritz′ homepage:

In the Pulp and Paper business areas, Andritz is largest. In this business area, the company offers technology and service opportunities for producers of paper, board and fibreboard and also specialized machines for tissues production.

The Rolling Mills and Strip Processing Lines areas ,company develops, manufactures and install plants for the production of could-roled and hot-rolled, surface-finished carbon steel, high-grade steel and non-ferrous metal strip.

In the Environment and Process area Andritz operate with products and services for mechanical and thermal solid/liquid separation for municipalities and major industries (mining, steel).

Feed and Bio fuel as an Andritz business area, include systems and machines for industrial production of conventional mixed animal feed and high-quality, special animal feed.

Rolling Mills and Strip Processing Lines-in this business area Andritz manufactures and installs plants for the production of cold-rolled, surface-finished carbon steel, high-grade steel and non-ferrous metal strip (Andritz, 2008).

1.1.8 安德里兹在韦克舍—Andritz in Växjö

Andritz in Växjö operates in the Pulp and Paper business area since more then 80 years. The company in Växjö is the product home for pulp drying technology, with world-wide responsibility for R&D and sales, in cooperation with the pulp drying line head office in

Andritz, Austria.' The drying line also includes screening, dewatering, cutting and baling technology, which are all managed from Austria. The projects for Andritz in Växjö comes with low frequency, once every five to ten years in Chile, first time ever in Uruguay in 2005 and once every three years in Brazil. This means that new project managers, purchasers etc without experiences in these countries participate in the projects every time.

The Pulp and Paper business area in Växjö constitute a 45% of the Andritz total concern. (See figure 2)

1.2问题分析— Problem analysis

The international business that the company has decided to begin can get some consequences that have strong effects on the success of the firm. A bad choice of a new country reduces opportunities and increases the risks for high financial losses. This in turn can lead to loss of control on the foreign market.

When conducting international business it is of great importance to consider the political, legal and economic environment. However, according to Mayrhofer (2004), the socio cultural environment is an even more important aspect. For instance if the issues regarding political, legal and the economic environment are successfully fulfilled, the cultural aspects can seriously affect the company’s future if not properly considered in advertising. Mayrhofer(2004) even said that companies, who want to be “a step ahead” of their competitors, need to be aware of the importance of the home-country factors. By this he means that companies should not neglect the cultural and institutional differences.

Zacharakis (1996) also points out that a company seeking international markets must consider cultural differences before entering. These differences can be of language, political states, culture, and religion and even demand types. It is easier to enter a new market if the company can create partnerships in the new country. By doing this, many obstacles can be reduced and the entry can be much more successful. Companies seem to have most success if they are expanding to a country that has similar culture as their home origin country has. Even if a country seems to offer once-in-a-life-time opportunities for the company, it must consider the risks and difficulties that an entering to an unknown country and culture means. If the company sells product that need specific adaptations, the firm is forced to learn more about the country′ culture. This learning can lead to benefits, but these benefits can be out weighted by the cost that this learning includes.

Ellis(2000) states that the company’s market entry decisions are one of the most important issues before entering a new market. Questions like which country to enter, how to enter it, are essential to answer before making further decisions. Kogut (1988) states another issue by mentions that the type of the entry mode a company chooses can also be an essential matter. Studies show that if there is a large cultural difference between the new market and the company′ home market, joint ventures are to prefer. This is due to the fact that if the company goes together with a local company, the cost and efforts to learn the new market and culture will be lower. How much experience a firm has, also affects the choice of the entry mode. Moreover, according to Adsit D. et al. (1997) the culture may affect the behaviour of individual managers and subordinates as they interact with others. This influences even the way employees view a manager, i.e. the content of the perceptions (leader, coach, and trainer) and also the structure (characteristics, behaviour and expectations). Further the authors state that expected behaviours are likely to be associated with cultural values. Some cultures are simple and others are complex in terms of the number of formal roles that managers and employees are expected to perform. In the case of large companies, they may tend to hire similar types of people worldwide, thereby reducing national differences. Also a company with such a strong organizational culture would have a levelling influence on employees’s values that would further reduce national influences.

1.3研究问题— Research question

Based on the problem discussion the following research questions were developed:

How do cultural differences influence the international business?

What are the most important cultural issues a company going abroad must consider?

1.4 目的—Purpose

The purpose of this thesis is to analyse cultural differences regarding negotiations and pricing.

The objective is to formulate recommendations to a Swedish company doing international business in Latin America. We are going to investigate what kind of difficulties the company can face and how it can avoid them.

1.5 限定—Delimitations

We are only going to investigate Andritz in Växjö and will not include the company′other business areas.

We are only investigating Brazil, Chile and Uruguay and will not include Andritz businesses in other countries and locations.

The external factors that we are looking at are only culture, price and negotiations. We are only going to analyse how these factors are different from domestic market factors and will not going to get deeply in to them.