Globalization and Business issues
This entry was written in preparation for the third in a series of three videoconference meetings among Khabarovsk State Academy of Economics and Law in the Russian Far East and Stanford students enrolled in the PWR 2 class "(R)evolutions in Environmental Rhetoric". The focus of this videoconference is "Globalization: Opportunities and Challenges”.
Julia Serdyuk: management style and globalization
Globalization eliminates the boundaries between the countries and provides new opportunities for business: want to open subsidiary in Egypt? Go ahead! Want to sell your shoes of high quality in Kazakhstan? You can try to! However, as the reality shows, it is not that simple and in many cases cultural differences, including differences in management styles, can prevent the success of a joint venture.
Traditionally, management styles have been divided into stereotyped groups, with focus on values. In this new approach, an issue that has received considerable attention is the examination of how values and beliefs of followers influence leadership styles and behaviors. Studies designed to investigate this issue often compare leadership across nations with different cultural value orientations. Every nation has its formed management style, based on its values, market place and market philosophy. For example, North American primary mode of activity is “doing”, while Latin American one is “being”, the conception of space is different (private vs. public), as well as temporal orientation (past, present, future), relationship to other people, etc.
In spite of all the differences between business cultures, we can’t neglect certain common grounds that constitute business in general. For example, each business deals with profit-orientation, professional development of staff, etc. And, thanks to globalization, today various countries can share and learn from each other in order to adopt new elements in their own operation. For example, Japanese companies now seem to be picking up lessons from American management to become more flexible and less avoiding uncertainty; American companies are learning best practices from their counterparts in other parts of the world, especially from Japan.
Having been off the market system for many years, and under the pressure of “command” authority, Russia had difficulties to enter the world market. While globalization was already involving all other countries, it did not “touch” Russian business and management styles until the 90th, when the country started reforming its own business style. Now, Russia constitutes a part of the business world and is interconnected with the world system. Russia adopted some well-known management models as well as developed its own business strategies.
What model of business style has Russia chosen? It is hard to define the model itself, as it is still being developed, but we can characterize Russian management style as more autocratic (hierarchy and power relations between boss and employees) than democratic, with flat organization. Although the tendency in management here is to get more people-oriented, less “power-oriented”. Employees get more and more appreciation for their knowledge, experience, and creativity. They are also given more choices and responsibilities at the workplace. I think, this indicates the development of a new management style, which has more similarities with American and European ones.
To summarize, globalization provides many opportunities as well as challenges in business. In order to better utilize the opportunities for different countries to operate successfully, under the conditions of cultural diversity, we need to go beyond our cultural stereotypes. Curiosity, openness and strive to reach mutual understanding should become good features for intercultural management. We can learn a lot from each other, but we need to learn to be tolerant and respectful to all the differences we face, when we do business together.
1. Stanford has a multicultural teaching/learning environment. Do you think Stanford professors imply different teaching strategies in a multicultural class of students in order to be more effective?
2. Do you believe that that there is a convergent global business culture emerging nowadays through globalization or, in opposite, divergent cultural trends prevail?
3. Concerning launching new products on the international market, what approach do you believe works better: making a pre-announcement of the product to be developed and launched or the secrecy approach meaning postponing any announcements of new product until the final launch date?
Ksenia Tkachenko : Negotiations and contracts
Globalization becomes a part of our life. Everyday we experience various products of globalization. We telephone to each other, we use our mobile phones to call to our relatives and friends in other countries, we watch TV satellite programs which are transmitted from other countries, and we surf through the Internet to find some interesting information and even to speak with our friends from different countries. In this way the influence of globalizations is so big that we can not do well without it in our daily life. Naturally enough, the process of globalization doesn’t ignore the business issues.
My topic of research is business negotiations and contracts, and I believe that the impact of globalization on negotiation in business is very important and significant.
Negotiations and contracts constitute one of the major issues in business. Every company faces various situations when it needs to negotiate certain issues with the other party in order to come to an agreement. Nowadays, thanks to globalization, business companies all over the world can easily connect with counter partners and negotiate different issues, as if they were in one room, say, with the help of videoconferencing. Regular telephone and telegraph communication seem to be not that effective today.. In spite of the fact, that for many companies involved in international business, Russian companies included, it is critical that contracts must be presented in the written form (in case the controversial point occurs and the company has to take the matter to court, the written contract must be presented as the evidence of a deal), many entrepreneurs in Russia as well as in other countries would conclude the contract by phone or by internet, when relationships between parties get very close and trustworthy.
Another impact of globalization is the way partners can exchange the papers and documents with each other. Now partners can share significant documents by means of e-mail and internet that significantly quicken the process of payment and arranging a deal.
It is interesting to notice that the process of negotiating is not similar with one another in different countries. It mainly reflects its cultural dimensions, values, and behavior. But because of globalization, people begin to adjust to each other and develop common basic tendencies of negotiation. Also, many countries adopt specific terms and strategies of negotiation from other cultures. More over, there are a lot of special training negotiation programs for individuals and corporations in Internet, which helps people to do their best in improving their negotiation skills. For example, people from Russia can download courses on negotiation from Negotiations Training Institute of America, and thus, they can participate in the seminars through the internet.
Of course, it is not easy to be a good negotiator; the process of negotiation is very difficult. The definition from Wikipedia identifies negotiation as a dialogue intended to resolve disputes, to produce an agreement upon courses of action, to bargain for individual or collective advantage, or to craft outcomes to satisfy various interests. I believe that negotiation is also a way to express your own views and opinions not only in business but also in daily life. We need to learn how to make this dialogue between different cultures more productive and enriching. Globalization provides many opportunities, but yet, many challenges for people of how to connect peacefully and fruitfully with each other. Our videoconferencing is one good example of how to advance negotiation skills in a tolerant and friendly environment.
1) Globalization provides many new opportunities and challenges for people regarding the way they connect and negotiate things with each other in business and in every day life. What opportunities and what challenges do you consider most important and what would you see as a way to progress with advancing the opportunities and eliminating the challenges?
2. How does a financial crisis influence your life? What do you think are the impact of it on your country? What do you think will happen to the international financial system in the future?