Business Culture in Different Departments

Business Culture in Different Departments

Abstract

A variety of operations keep businesses, especially large corporations, running efficiently and effectively. Common business operation divisions or departments include production, marketing, finance, management and human resource management. Business activities are becoming increasingly global as numerous firms expand their operations into overseas markets. Many American firms, for example, attempt to tap emerging markets by pursuing business in China, India, Brazil, and Russia and other European countries. Multinational corporations, which operate in more than one country at once, typically, move operations to wherever they can find the least expensive labor pool able to do the work well

Cross- Cultural Management Department

The function of management in business mainly has to do with the expertise of efficient organization, planning, direction, and control of the operations of a business. In organizational management, management has two principal aspects. One relates to the establishment of so-called lines of responsibility, drawn usually in the form of an organization chart that designates the executives of the business, from the president to the foreperson or department head, and specifies the functions for which they are responsible. The other principal aspect relates to the development of a staff of qualified executives (Griffin 2012). Planning in industrial management has three principal aspects. One is the establishment of broad basic policies with respect to production; sales; the purchase of equipment, materials, and supplies; and accounting. The second aspect relates to the implementation of these policies by departments. The third relates to the establishment of standards of work in all departments. Direction is concerned primarily with supervision and guidance by the executive in authority; in this connection a distinction is generally made between top management, which is essentially administrative in nature, and operative management, which is concerned with the direct execution of policy. Control involves the use of records and reports to compare performance with the established standards for work and to make important decisions (Williams 2010).Cross cultural management as a department is formulated by a company or firm to manage all matters that have to do with cross cultural activitiesby the company as well as other departments that help to run the cross cultural activities of the company notably, includes international business.

Considerations of the different departments while doing business internationally are inextricably linked to the roles of the department. In cross cultural management’s duty to determine the style of business used in new territories and countries it is prudent to consider the economy of the new territories or countries. . The key reason for this is that businesses are inextricably linked with the economy of the region in which it operates (Walker, Walker and Schmitz 2003). This is true regardless of the kind of business conducted, its size and its target market in the region. The economy of a region takes into considerations matters such as a region’s financial capabilities, gross domestic products of countries in that region, the purchasing power parity, expenditure capacities and its general ability to support itself financially. Factor such as the stability of the economy should be taken into consideration, as well as the strength of currency and the ability of people to purchase goods. Consideration should be taken as to whether new economies where the business want to venture into are free markets or other types. In such economies business is largely left to business people and the forces of supply and demand.  This differs from the economies of Socialist or Communist countries, where governments play a strong role in deciding what goods and services will be produced, how they will be distributed, and how much they will cost. The style of business should be compared to that of the native country and any potential conflicts should be anticipated and prepared for. The effects of the global financial crisis on the region should also be well examined and its effects on cultures in new countries understood so as to enable easy entry into the new countries.

Another key factor in   cross-cultural management is the culture of the new country that a business aims to invest in or expand their services to. A common mistake that is usually made by most cross cultural business managers is making the assumption that countries from the same continent or region share the same culture. Walker, Walker &Schmitz (2003, pp.39) observe that the simplistic habit of attributing a homogenous culture to entire regions or nations is both unrealistic and unproductive. Each country’s history is important to it as it has a bearing on its politics, economics, culture and social life. As a result of the diversity at play in a region it is hard to pin down one single culture that determines how businesses are run. However, there are still some things that are relatively common across borders. The implications of a country’s culture on its business activities should be put into consideration and mitigation strategies employed in case there is need for it. Different lifestyles, common behaviour and thought patterns and their potential influence on business should also be considered. In  places like Europe for instance, business is generally considered as a serious thing over which unnecessarily joking is generally not unappreciated although the degree of formality varies indifferent countries (walker, walker and Schmitz, 2003 p.100).In other places such as Latin America however, business is almost always preceded by social interactions (Becker 2004).The kind of consumers that are the targeted demographic of a business as well as their consumer behaviour should be well examined. The general awareness and education of a particular population or the lack of it is an issue that should be considered as this directly affect consumer patterns. For instance environmental conservation awareness among most Europeans makes the market more receptive to environmentally friendly products as opposed to those that are not (Walker, walker and Schmitz 2003).

The significance of mergers and partnerships with companies in other countries should be examined by cross-cultural management, putting into consideration the resultant mix of cultures and the potential clash of the same. Acquisitions should also be considered and the resultant intercultural interactions as well. The same should be taken into account about outsourcing business activities. It is also prudent to consider country-specific peculiarities that are involved with different cultures. For instance it would be an unproductive and an unwise decision to launch a particular food product in a predominantly Muslim country during Ramadhan, which is the fasting month. Issues of language should also be given serious consideration when going into a new country or region for business. Mole (2003) asserts that Language is the most important competence in international business. As such if business expansion is being done in a country that speaks a different language, then translation services should be considered as well as the learning of new languages. The use of body posture and gestures to communicate, whether consciously or otherwise is a fact that should also be considered relative to different cultures (Mole, 2003, pp.20).

Much of the elements of risk involved in doing business in both Northern and Western Europe depend on the acceptance of the new product or services. Products or services or their delivery may be particularly unappealing to the customer populace. Expectations need to be met in terms of Quality, pricing and customer service. Kalb (1993) asserts that it is necessary for a business owner to clearly define the type and purpose of business he/she is starting. In this way he/she is able to perfect skills and product quality so as to better meet customer expectations.

Overall, cross cultural management has the duty to liaise with other departments in the business that are involved with international business, organising and controlling them so as to ultimately make entry into a new country  or region business-wise an easy experience. Ultimately the goal is to enter and operate a business profitable in the new region and experience favourable growth of the business as well as the understanding of the new culture so as to function effectively within its context (Johann 2006).      

Human Resources Department

The human resource department is responsible for personnel management. It is concerned with people at work and their relations within a firm. The main function of the human resources manager usually includes staff recruitment, training, and welfare. The term personnel management is somewhat misleading in that it is usually line managers who manage the work force, while the main HR managers provide a mainly supportive and advisory service (Montana and Charnov 2000 p.211).

Businesses rely on effective human resource management HRM to ensure that they hire and keep good employees and that they are able to respond to conflicts between workers and management. Human resource management specialists initially determine the number and type of employees that a business will need over its first few years ofoperation. They arethen responsible for recruiting new employees to replace those who leave and for filling newly created positions. A business’s HRM division also trains or arranges for the training of its staff to encourage worker productivity, efficiency, and satisfaction, and to promote the overall success of the business. Finally, human resource managers create workers’ compensation plans and benefit packages for employees (Montana and Charnov 2000).

Human Resources departments have a large role to play when it comes to doing business internationally. Globalization has precipitated an unprecedented growth of international trade. According to a 2006 World Investment report issued by the United Nations, ‘a total of 77,000 transitional corporations with over 770,000 foreign affiliates employed 62 million  workers worldwide’ ( Dowling, Festing and Engle 2008 p.24). These figures give an indication of how rapid the growth of international trade is and show the need for human resources department sin different companies in managing the thousands of new employees.  

The international expansion of a business bears implications in terms of the requirement of human resources in the new country of business. Human Resources departments are charged with the responsibility of recruiting personnel for the company whether locally or internationally. This is the primary responsibility of this department. In this regard, HR needs to make considerations about whether the nature of personnel required for the job internationally may be recruited from the new countries or locally. If recruitment is done in host countries, then considerations need to be made for the accommodation of the country’s culture in the recruitment process. General levels of education and awareness need to be considered. If HRM department  chooses to assign an already existing employee to the new country, then several considerations need to be made such as, the need to provide pre-departure training , provision of language translation services where necessary and arrangement of settlement –housing. Considerations need to be made by HRM concerning the adjustment of employees into new cultures and environments as well as the reception of those cultures on the expatriates. The HRM department should facilitate language –compatibility of employees to the new business areas.

Considerations for the increase in employees on a global basis should be taken into account. They need to identify and develop talent, not only to work in the new regions of business as well as more HR personnel to manage them. Most company HRM departments have to enact policies to handle HR on a global scale. There is a need to align HR policies with those of host countries. The HR department also plays a large role in the determination of the costs of recruiting new personnel and deploying them into new territories and to take on an advisory role to finance departments concerning budgetary implications for the same (Dowling, Festing and Engle 2008).

Considerations have to be made for international labor laws and country-specific laws when exporting employees to new territories. This is because employees have to respect the laws of countries in which they operate. Expatriates are often forced to bear tax liabilities for both the host country and their native country. As such HRM has the duty to shield the employee against such tax burdens so as to make sure that such factors do not become a deterrent factor to potential employees (Dowling, Festing and Engle 2008).Tax equalization procedures should be set in motion.

The culture of new countries and their potential implications on employee job satisfaction should be considered. Johann (2006) suggests that HRM departments should consider the common beliefs and behaviour systems in a certain region, so as to better adapt its policies to them as well as effectively train their employees on the same. Important cultural and societal consideration such as the importance of power distance should be observed. This has to do with power distribution in an organization and how the same is perceived by employees, especially lower-ranking ones. Individualism verses collectivism and masculinity versus femininity in a society should all be considered as factors that could possibly have an impact on employees (Johann 2006 p.6).

Ease of relocation and re-settlement for expatriates should be considered and any extenuating circumstances be dealt with. Factors such as availability of infrastructure, social amenities as well as essential services such as hospitals in the new areas for employees are a worthy consideration for HRM departments. This is because HRM is charged with the responsibility of employee welfare. Matters to do with the employees’ health and relative comfort should be taken care of and any potential threats to the same, considered.

Issues of potential risk exposure to employees depending on circumstances surrounding host country should be considered. Ideally, employees should be shielded from as much risk as possible. Still a risk allowance should be given in addition to the regular salary so as to act as a form of compensation for the risk exposure ( Dowling, Festing and Engle 2008).The  threat of terrorism in the world today has become a source of great concern to businessmen. As such business activities in potential threat areas should attract larger risk allowances for employees on the ground. 

In cases where a firm is outsourcing services from another company in the host country, then it is prudent for HRM department to consider the level of quality of employees offered by the service provider .In such cases HRM department has a duty to research on laws about wages in host countries so as to ensure that they remunerate workers fairly in respect to heir context. As such the effect of change in currency and the difference in currency strength should be considered so as to ensure workers as justly remunerated. The HRM department needs to consider the implication of employee needs and the general cost of living in specific regions where the company seeks to start business. This is essential in deciding what offers to make to employees in terms of remuneration. Consideration also needs to be made by the HRM about whether personnel administration would be done from one point or whether a de-centralised system would have to be adopted, and different members of the HRM team deployed to different co untries internationally. This is largely dependent of the size of the company and the nature of the business.HRM may need to consider the kind of personnel fronted by leading competition in the market and seek out ways to ensure that employees are better than theirs.

Finance

Finance involves the management of money and this is the key function of the finance department in a firm. All businesses must have enough capital on hand to pay their bills, and extra capital to expand their operations. In some cases, they raise long-term capital by selling ownership in the company. Other common financial activities include granting, monitoring, and collecting on credit or loans and ensuring that customers pay bills on time. The financial division of any business must also establish a good working relationship with a bank. This is particularly important when a business wants to obtain a loan. The overall goal of finance departments is to maximise profits for the firm and shareholder by proper management of funds (Chandra 2008 p.6).

Corporate finance departments basically deals with how businesses raise and spend their money (Griffin 2012). Companies spend or invest funds in projects that might make the firm more profitable, such as a new factory or an improved product. Corporate finance involves selecting projects that maximize profits and make the best use of a company’s funds. Sometimes businesses can fund these projects on their own. Other times businesses must raise funds from outside the company. A corporate finance department also involves finding the best way for businesses to pay for their projects.

Considerations ought to be made finance departments concerning the levels of technological and ICT levels in new markets. This is because finance is almost entirely reliant on the availability of such technology so as to function. Modern finance requires superior computer programs and connectivity. The level of technological and ICT development is not only important to the finance department operation s but also plays a large role in determining payment methods. For instance availability of technology makes it possible for wireless transfers to be possible. Online sales would also be made possible by the same. There are large cost implications that accompany the lack of such technology and this would ultimately impact the profitability of business.

The finance department also needs to consider financial implications of expanding to new countries vis-a-vis the available funds to determine possibility of such expansion and at what pace it is possible. The costs that go with international expansion in all the different departments of a business such as human resources, technological resources and resources for marketing form the bulk of the budgetary requirements and should be considered . Should the company require additional resources for international expansion, then the finance department needs to consider sources of such additional funding. Considerations about whether accompany should undertake debt financing or equity financing should also be a consideration of the department in such situations. Overall, the department is supposed to ensure that funds are available for every other department for the efficient running of the company.

The literacy levels and technological savvy-ness of new customer pools needs to be considered so as to determine how to deal with them financially. The modes of payment are affected by the same. The financial peculiarities of a region should be thoroughly assessed so as to make sure that no unforeseen challenges within the control of the department face the company.

Events outside the control of a corporation can affect the firm and its financing decisions. This is the reason why finance departments need to consider  financial international finance issues such as the global finanvial crisis which has had an effect on many businesses. Mitigation  strategies should be set up so as to be able to handle such situations. 

The finance department needs to consider as an issue of paramount improtance, the economic stabilityof the region in which the business seeks to operate. Such consideration should take intoaccount matters such as a region’s financial capabilities, gross domestic products of countries in that region, purchasing power parity, expenditure capacities and its general ability to support itself financially. Differences in economies of different places could translate into different finance practices in businesses. Consideration needs to be made for international finance as the finance department is now forced to deal with fund sat a more global scale. AS such issues such as international banking have to be considered. Financial cultures in different parts of the world and especially in new markets have to be taken into account so as to ensure a smooth transition form local finance management to international management. Matters connected to currency strength as well as shared currency should be well considered and assessed by financial departments and their implications made known. In Europe for instance the common market protocol and the adoption of one currency (the Euro) has fostered a strong economic bond among member states (Suder, 2008, pp.3). This provides a number of opportunities and challenges to the investors. The investors are not only provided with a large varied and widespread market but they also enjoy a large space to try out new products and services across the diverse cultural spectrum. The common currency makes trading across countries easier and the common market eliminates most of the traditional trade barriers hence making movement of goods, services and people within the region smoother. A common market however, comes with its on challenge, key among them being that since the economies of these countries are inter-linked it poses the risk of an economic crisis in one country affecting other member states such as experienced in the ongoing Euro-zone crisis.

Prior to the establishment of a business in any particular country , considerations about the policies, laws and legislation governing business and other related  activities in that country are worth taking. First and foremost licensing and start –up requirements by the government or relevant bodies have to be met by potential investors. The more complex and bureaucratic, the process is, the more financial implications it might have. Tax liabilities fo rthe business also need to be considered here. If the cew country is affiliated with regional bodies whose policies have an effect on business policies then thi should also be taken in to consideration. Taxation and legal frameworks that prove to be complex and bureaucratic in many parts of the region represent a form of barriers to the expansion of businesses (Neelankavil and Rai, 2009 p.182). Particulaire country législation  has an effect on business finance should also be considered. The extent to which the region enjoys free markets, where prices are left largely to the forces of demand and supply,and government policies do not generally interfere with commerce should be determined an dthe impact ofthi son business finances assessed.

The offering of incentives, control of currency and exchange rates as well as the control of trade and commerce regulations enable governments to exert some influence in business activities (Campbell,2009,pp.5).  if this is a feature that is common to a country in which the business wants to expand then considerations should be made on the impact of the same on finances in the business.

If the companyintends to launch international Initial Public Offerings, or undertake significant moves such as larger mergers and acquisitions, then teh compnay would need to rely on the finance department for direction As sch the department needs to take into consideration factors that may affect such moves directlty or indirectly.

Marketing

Marketing is the process of identifying the goods and services that consumers need and want and providing those goods and services at the right price, place, and time. Businesses develop marketing strategies by conducting research to determine what products and services potential customers think they would like to be able to purchase (Moore and Pareek 2010). It involves the application of marketing strategies with the end goal of meeting a company’s needs (Moore and Pareek2010 p.7).Firms also promote their products and services through such techniques as advertising and personalized sales, which serve to inform potential customers and motivate them to purchase. Firms that market products for which there is always some demand, such as foods and household goods, often advertise if they face competition from other firms marketing similar products. Such products rarely need to be sold face-to-face. On the other hand, firms that market products and services that buyers will want to see, use, or better understand before buying, often rely on personalized sales. Expensive and durable goods—such as automobiles, electronics, or furniture—benefit from personalized sales, as do legal, financial, and accounting services.

Globalization is a catchall term for many processes that are at the heart of the global economy: the spread of instant global communications; the rapid growth of international trade, global capital markets (markets in which national currencies are traded), and foreign investment; and the emergence of a new breed of global corporation. The global economy is the product of all these things, and more than the sum of them. It is a revolution that enables any entrepreneur to raise money anywhere in the world and, with that money, to use technology, communications, management, and labor located anywhere the entrepreneur finds them, to produce goods or services that can be sold anywhere there are customers.

The overriding concern of any marketing department is to attract new customers into a business and ensure retention of existing customer (Moore and Pareek, 2010, pp.8).As such internationally marketing involves doing the same on a larger scale and to a greater, global audience. Marketing departments therefore have the responsibility to ensure that company products or service are both known and preferred by customers in their areas of business. In this light one of the greatest considerations for marketing department in an international context is its ability to communicate and engage with its intended or targeted population concerning a product. Considerations therefore need to be made by such departments about who the targeted population is and their behaviour pattern. It needs to be considered whether products or services will be offered to an entire population or a chosen demographic, or whether different products are adapted to suit different segments of the market. Moore and Pareek (2010 p.11) assert that segmenting a market allows marketers to identify which groups the most attractive targets for business. It should then take on an advisory role, to help direct both management and finance departments on which the best places to invest are and which demographics to target in a given population in relation to products or services offered.

Considerations need to be made by any marketing department concerning the ease of breaking in to the market and establishing respectable brand name and brand equity. Moore and Pareek, 2010,pp.14) observes that one of the key ways of establishing a strong brand is to ‘create enough points of parity to be able to be considered as part of a product category, and enough points of difference, to be distinguished against competing brands. Marketing has to consider ways in which they will be able to promote brand awareness in new regions as well as any cultural, technological or other factors that may make this process difficult of hinder it.

The freedom of the media and the extent to which it has an impact in new markets should be determined by marketing departments who rely mostly on it for their marketing activities. Language used in new markets should be considered as a fundamental issue to marketing departments as marketing will only work where communication is effective (Mole 2003). Marketing personnel should therefore receive training in the local languages, or translation services considered.

Marketing departments should also consider and make provisions for whether or not their existng market programs can be standarddised and used across international markets or if it would be best to devise country-specific marketing plans and systems. Standardising marketing procedures acrossdifferent region smakes the marketing process easier. It might however attrct unpleasant consequences by the failure to adapt to consumer needs  at particular times when required. Certain markets may also resist certain appraoches to marketing.Such decisions are pegged on the type of product or servce offered an dthe nature of teh targeted population.Decisions as to whether to operate marketing from one single place that manages all marketing activities or across international   markets, or whether to de-centralise the system are also key to a marketing department.All these lultmately constitute a marketing strategy that the department has to devise, to determine its operationd in a new region . Considerations and  research needs to be done concerning the most effective ways of marketing in different regions.

Research into targeted area of business , its people, culture, language  and receptiveness to their products need sto be asseesd by a marketing epartment so as to determine what approach of marketing to use.When launching a product whose targeted demogarphic is young people between 15 and 25 tears, of age for instance, itis necessary to study their behaviour patterns and areas where they spend most of their time so as to be able to determine which method to best reach them. Such a demographic for instance would be easily

Reached through phone and online  advertising, as opposed to news paper advertising, since they spend most oftheir tim eon their phonesna don computers. A The level of technological and infrastructural development needsto be considered by a marketing department as such factor are instrumental to their operation and activities.a firm seeking to expand its business to Japan for instance would face very different technological and infrastructural challanges, as compared to aone expanind its business to a country in Africa, where the techniological and Infrstructural components may be at a low level. Technological factoers present  avarity of ways in which to connect witha teargeted population and increases ease of doing the same. The development of ICT in new markets is particularly significant to marketing departmenst and its availability should therefore be considered.

The extent to which newer methosds of advertsing  such as social medis advertsing  as wellas blogs as useful in new markets should be considered. Halligan and Shah ( 2010 p.7) observe that in the modern –day world, targeted audiences are mno longer reading trade publications.Instead they are seraching google, an dsubscribing to blogs written by poeple who used to write for trade publications and newspapers. They therefore encourage a concentration of advertsing through these methods and ahsift from taditiional advertsing venues. It is also incumbent upon a marketing department to determine what major ways are used in a particular plac eto advertise and to interact with major advertsing avenues, such as trade shows  so as to better be prepared for advertsingina new region. Advertising initiatives organised by the marketing department must take into consideration the culture of the region ( Mueller 2010 p.107).

Financial implications of marketing activities in new markwets should be considered by teh departemnt and ways of lowering the same considered. Marketing departments need to study the competition and make considerations about how the ir product can perform against them in the market. Competition refers to the number of businesses dealing in similar products and or services and targeting a common market. The more the players the thinner the market and consequently the more effeort has to be put to market products so as to make them more outsatnding to consumers (Walker, Walker & Schmitz 2003). New entrants will therefore be advised to carefully study the market before venturing into existing fields.The marketing department may be able to determine consumer needs and the need for innovation in saturated markets. IT can therefore play an advisory role to production departmentsand themangement.Marketing needs to consider how well products are doin g in the market so as to make recommendations for  diversification, a relentless search for superior products and competitive pricing. Globalization, changing technologies, learning and development are some of the factors that affect competition in the region  (Walker, Walker &Schmitz 2003 p.6). These factors hsould be well considered by the department and necessary adjuctments made. Specialists in the marketng department needs to consider ways in which they can achieve synergy between local and international marketing.such synergy is for the betterment of the entire marketing department and the whole organization.