The higher the rating, the closer the culture is to individualism, and the lower the rating the closer the country is to collectivism. Being more individualistic means the people of the culture are expected to look after themselves and the immediate family around them. They do not have any ties to anyone, and it is the social norm for one to make their wealth on their own. An example of high individualism is our very own country Canada. Being closer to the Collectivism side means that the culture tends to make decisions in a group. An example of a country that has a low individualism rating is Taiwan.
The people of Taiwan are expected to make sessions in a group, and always get someone else’s approval before taking action. Low vs.. High Power Distance (POI) shows the level of equality amongst a nation. A country with a high power distance represents a high level of in- equality citizens don’t have much of a say in what happens to their economy. Governments are likely to own the businesses in the country, meaning there will be no high power in a corporation. Low power distance in a country means there is a high level of equality where people have much more freedom, and are likely to be more productive.
Masculinity (MASS) vs.. Femininity is the level in which the culture promotes male power and equality opposed to the traditional male control and power. A higher rating means that males dominate the work force, and females are controlled by male authority. An example off country with high masculinity is Japan. A low masculinity ratings means females are treated equally amongst the country, and is a social norm to have women in the working class. Norway is an example of a country that shows female equality. Men do not have any more power then women, as it is the second most female equal country in the world.
Uncertainty Avoidance Index (ALAI) measures the tolerance level or accepting change and opinion. High rating means the country has a low tolerance for change and opinion, creating a rule-oriented society. For example Portugal is against change as they have a very high rating. A low rating means that the country can tolerate change, and promote being ambiguous and finding new ideas. An example is Jamaica. New change for them may boost their economy this can be very important for international business opportunities because the more tolerable they are to change, the easier it will be to work out certain deals with that country.
Long-term orientation (L TO) vs.. Horn-term orientation shows how much a country is committed to traditional long-term develop. A country with a high ranking represents that it believes in the value of sticking to long-term commitments. Eastern Asian countries tend to have the highest believe in long-term commitment. A county with a low ranking represents that it does not encourage long-term commitment. Countries with high LTO will make it very hard for foreign business’s to develop. So finding out this ranking is crucial to know the possible success ones business will have in a country. 2. Country PDP MASS AAU LTO Canada 39 80 52 23
Brazil 69 38 49 76 65 To identify the cultural differences between Canada and Brazil conducted information from http://egger-hefted. Com/Canada. HTML The Hefted Centre. The differences in Power Distance show that Brazil ranks higher then Canada. Brazier’s P Del represents that their society agrees on unequal and order within its country where authority should not be questioned. This brings problems for the company because of Canada’s lack of control in which Brazier’s high power distance may cause frustration amongst the workers. The promotion in Brazil on inequalities make it difficult to have a lass system in the subsidiary.
In Canada Adams would have a lot more freedom to do what he wants, and run the subsidiary is a specific way, however the government and other high powers may cause barriers for him. Individualism showed that Brazil has a much higher ranking then Canada does. Bombardier’s success can be affected because of Brazier’s low individualism, this means that they like to make their decisions in groups. This creates problems because John makes decisions for himself. He will now have to consult other people on their opinion before making the final decision, which may create conflict.
Another problem that may occur is the fluency in Dam’s speech in Portuguese, this will make it difficult to communicate in-group discussion with the people native to Brazil. Fortunately for Adam Masculinity between both countries are very similar. This will be helpful to Adams, as he won’t need to change his business etiquette. The certain values of Canada’s culture among gender will not change in Brazil. If Brazil were to have a high masculinity ranking, Adams would run into problems like the disapproval of hiring female staff, or having a female supervisor.
Even though masculinity might not be a problem facing t is also less likely to create problems because it is already dealt with in Canada, therefore making it one step easier to run the company in Brazil. Ratings show that Brazil has a lower tolerance for change with a high uncertainty Avoidance. For Adams this creates problems because Canada accepts and permits change. Employees in Brazil however tend to stay with their organizations, and do not intend on changing, the same applies when doing business with another organization.
The Brazil companies will want to stick with companies they’ve been doing business with over the past years, opposed to changing ND doing business with Bombardier. As well as business, costumers also don’t like to change. Their culture promotes to stay with organizations that they are familiar with. Bombardier for example beings a new comer will have trouble starting off, and promoting their products. Adams main concern will in trying to prove why Bombardier’s products are better than the ones in Brazil and how they might help the consumer, the economy, or even other companies.
Long-term orientation vs.. Short-term orientation are very different in terms of both countries. Brazil finds that long term orientation is a bigger asset rather Han the short -term which Canada sticks strongly to. This may pose problems for John as he is used to rapid change and loose commitments. Brazier’s high L TO may make it harder for Adams to develop Bombardier amongst the society in which his subsidiary is located. In conclusion I think John Adams will have his hands full running the Bombardier subsidiary in Brazil has we have to opposing cultures.
Having a different culture will affect his target market, marketing plan, use of language and human resources, etc. He will need to take time to understand the culture better before jumping in to business transactions. A great idea that Adam can do is visit Brazil as a tourist where he is able to analyze how their culture is different from Canada’s. He should outline the similar, differences, tools, and other individuals where he can seek for help from. This will than further allow him to make better much confident decisions down the road, as he will understand how the Brazilian society thinks. 3.
Not being able to speak Portuguese in Brazil may be a major concern for Adams. Being able to speak the first language of the host country is very important when doing international business. Not only will it help Adams monomaniac with Brazilian, but it will also show that he respects the country and their culture. It is more important aspect for Bombardier to higher a candidate who can run a subsidiary smoothing like Adams rather then higher someone who isn’t as good at their job but can speak fluent Portuguese. In cases where Adam does run into communication problems, he can just hire a translator and his problem is solved.
In addition, Adams speaks fluent Spanish, a language that is very similar to Portuguese. This works to his advantage because although not many Brazilian speak Spanish, charity of them can understand a lot of it. Worst-case scenario for Adams is that the person whom Adams is doing with can neither understand English nor Spanish, and he is forced to hire a translator. Despite the difficulty he may have, it is not an overriding consideration in the selection. Adding to this will test Adams skills to run an international business without using his first language.
Even though risks may occur, after being around a new culture for a while Adams will get used to speaking a hearing new things on a day to day lifestyle, which will make it easier for any other commutation in Brazil. Portuguese will quickly turn into a fluent language for him. I strongly believe that Bombardier will have bigger problems dealing with Brazier’s low L TO then worrying about communication. Even if there are other problems that might occur with the translator, don’t expect Adams to get off to a quick start with the marketing of the company in Brazil.
This will give time, and with time Adams is likely to already be fluent in Portuguese, eliminating the use of a translator. 4. To first figure out if Canada can be a match for Brazil it must first test out the market screen process. According to the market screening process, the first hinge to look if a country has a favorable market for their product is Basic Needs. Bombardier is a company that produces trains, planes and snowmobiles. Snowmobiles are not relevant because Brazil does not have any snow. Even so it does have the second largest amount of airports which do need airplanes and the tenth largest in the world for trains.
This opens up a huge market for Bombardier, as Brazil is favorable to the company basic needs. The next step in the market screening process is the Economic/Financial screen. Looking at the CIA fact book shows that Bombardier will fit in Brazier’s economy GAP unemployment Rate Inflation Rate Total Exports Imports Debt Exchange (To US. ) 2. 19 Trillion 5. 7% 6. 2 % 244. 8 Billion 241 . 4 475. 9 2. 153 Brazil has a very high GAP, which means that any company wanting to do business in Brazil will be able to do it because of a high GAP.
A lower unemployment rate suggests a strong economy. However their inflation rate is borderline high, making the price Of market goods to increase. Brazil exports more then they import, representing a positive balance of trade. Even though they do have a debt it is far less than Canada’s. Their exchange rate shows 2. Real per one U. S. Dollar. This is Canadian dollar, it is worth less. All in all, Brazil has a very absorbing economy, which is favorable in the screening test primarily high to GAP and positive balance of trade. Stage 3 Legal and Political forces screen.
Brazil is a federal Republic government. Brazil has had very strict regulations with cross border transactions, but in 2005 Brazil attempted to make them much more flexible and simpler. The Brazilian government is making efforts to improve climate for foreign investment as it seeks to make more market-oriented economy. Import barriers have decreased Brazil has control over private businesses but the government has moved to change an economy driven by market forces. Price controls are no longer in place, import barriers, including import duties, have been decreased.
All if the factors put Brazil in a favorable point through the political/legal screen. A very important factor to look at is the Coloratura screen. There are four classes in Brazier’s social class system. The high-class people have more property and status. The middle class is divided into people who are employed or a work force based on knowledge and skills. The lower class lives below the income National poverty line and includes 21. 5% of the country’s population. Another important thing Bombardier should research is the business etiquette in Brazil.
In Brazil men shake hands when greeting one another, while maintaining steady eye contact, women generally kiss each other, starting with the left and alternating cheeks, hugging and backslapping are common as well. Competitive Screening is next. The largest competition is in the railway-operating and plane-manufacturing market. The top train competitors include (FEM.), (AFC), and (FCC). The suppliers mostly come from Chinese and Japanese manufactures. Nevertheless they do delivered at a low volume of vehicles around 65 units.
From this opens bigger opportunities for Bombardier, the low volume of units being sold in the last couple of years. If anally the last part of the market screening; the Final Selection. Bombardier should bring in their in Steven Harper to meet with Brazier’s president because this would build a strong relationship between the two high powers. This would then increase chances for success in Brazil. Overall, Brazil is passes all parts of the screens in the test, making it the perfect market for Brazil to start a subsidiary in.