BMCF I TM I Prague University Of Finance & Administration INTERNATIONAL BUSINESS [NA_IB] Ing. Pavla Břečková, Ph.D.

2.2. INTERNATIONAL BUSINESS Full-time course = 12 sessions á 90 mins. 1-2/ What is international business (IB). IB basic indicators - balance of trade / payment. International business importance and influences, differences from domestic trading. Territorial / commodity structure of IB. Global business environment. Comparative advantage, free trade / economy. The main regional trading blocks. 3-4/ Internationalization and Globalization. Drivers of Internationalization. Categories of goods traded internationally (primary, low/high value, capital intensive). FACTORS influencing the IB environment (Political, Economic, Technological). Motives for foreign expansion (microeconomic view). Entry modes and business activities in IB (export, import, contractual, investment activities, FDI). Team work on the semestral project. 5-6/ Culture and its role in international business. Cultural elements and multi-culture communication (verbal, non-verbal, role of eyes, silence etc.). Hofstede’s five dimensions of culture differences. Negotiation and successful presentation of business results in the international environment. Team work on the semestral project. 7-8/ World business territories, Euro / Dollar zones. Emerging markets, newly industrialized countries. International market research (PEST/STEEP), and linkage to Competition analysis (Porter) and SWOT. Data collection and their selection in the international environment. Team work on the semestral project and prezentations. 9-10/ International trade barriers and their assessing. Forms of economic integration, international unions, free trade areas and multilateral agreements The main regional trading blocks (TRIAD). WTO, GATT. Impact of economic integration on micro environment (companies). IB policy instruments (autonomous, contractual) Team work on the semestral project and prezentations / Prerequisites and personal preconditions for working in international business. European Union principles of IB. Opportunities and threats of CZ membership in the EU. SWOT of Czech companies in the international business environment. Topical international business challenges and trends. International Business knowledge summary and evaluation, presentation of team business work results. INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

3.3. EXAM terms NA_IB 12 lectures (per 90 mins) Completion: exam / 6 credits Completion CONDITIONS: Active participation in the guided consultations [active listening, discussing, reading, analyzing & interpreting of economic articles or case study results, presence at lectures – 50%] Semestral study elaboration & it’s successful prezentation Based on the above you’ll be offered a grade. If unfulfilled / or if unhappy with the offered grade => written exam to prove the knowledge in IB

SEMESTRAL study / team work CASE study on one of these topics: 1. BUSINESS TRENDS / opportunities in the next 10 years Largest threats & opportunities from the point of view of international business, where it (IB) is going. Areas where it is likely to find the business opportunities during next 10 years + explain what brought you to such results. 2. EXPORT STRATEGY Mid term view (3-5 years). What it should lie in, generally - how to support export (of CZ enterprises), concrete forms + in which business and industry areas (if in any / if not in all of them) + explain why 3. Finding the COMPETITIVE ADVANTAGE for the Czech Republic (and of the CZ businesses). Competitive advantage + consequently what areas of business and industry should be preferential (if any) + what to do for succeeding in international business from the point of view of competitive advantage (micro and macro view). Possibly also what kind of business environment (or changes in the present one) would help developing the CZ businesses competitive advantage?

SEMESTRAL study - elaboration CASE study on one of these topics: 1. BUSINESS TRENDS / opportunities in the next 10 years 2. EXPORT STRATEGY 3. Finding the COMPETITIVE ADVANTAGE for the Czech Republic ELABORATION:  Elaboration in teams per 4-5 people  Presentation of the results - ppt possible, cca 10 min., structured way, clear outcomes (solutions, results) PREZENTATION: - Date – TBC - up to 10 min. / all the team members should be involved

6.6. LITERATURE SOURCES Mandatory: Charles W. L. Hill: Global Business Today, McGraw-Hill/Irwin, 7th edition, 2011 Optional / Recommended: Allan Sitkin, Nick Bowen: International Business, January Woods, M.: International business. Basingstoke, Palgrave, ISBN: Wild, J., Wild, K., Han, J.: International business: the challenges of globalization. 4th ed. – Pearson, Upper Saddle River, ISBN: Griffin, R.W., Pustay, M.W.: International business: a managerial perspective. 5th int. ed. - Upper Saddle River, Prentice Hall, ISBN:

7.7. CULTURE DIFFERENCES = impact of culture on relationship, employees approach to work, business management and negotiations -> this impact is much > than differences coming out from: o RACE o SEX o specialization [PROFESSION] o POSITION INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

8.8. CULTURE and it’s elements CULTURE = characteristic way of living = based on ACQUIRED models of behaviour (i.e. learnt, not inborn) Culture ELEMENTS  ABSTRACT (values, approaches, opinions, religion – from generation to generation)  MATERIAL (stage of development and types of: technology, structure of consumption in a country / society ) INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

Transmission from one member of society to another Culture reflects LEARNED behavior e.g.: hierarchical society => stress on loyalty & harmony => results in life-time employment & minimal job switching (Japan) Elements of culture are INTERRELATED Because cultural is LEARNED behavior, it’s ADAPTIVE i.e. culture change in response to external forces that affects society Behavior is ADAPTIVE Defines the membership of the society i.e. who shares the culture ‘proves’ to be a member / who does not => outside of boundaries of society Culture is SHARED 9.9. Characteristics of Culture [relevant to IB] Culture = collection of values, beliefs, behaviors, customs and attitudes that distinguish one society from another  society culture determines how firms operates in the society INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

10. Basic elements of Culture CULTURE Language Communi -cation Religion Values & Attitudes Social structure INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

11. SOCIAL structure = determines the roles of individuals within the society, indiv.mobility within society, stratification of the society  Individuals, Families, Groups Social attitudes influence / Business: US descourage nepotism Arab countries: family ties crucial Importance of INDIVIDUAL to the group: Europe culture promotes individualism (PAY = merit based) group focused societies = the IND role is to SERVE the group (PAY = seniority-oriented, group success) Social STRATIFICATION Social MOBILITY ability of IND to MOVE within stratums of society INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

12. LANGUAGE = identified > languages worldwide Business language Form of language Competitive weapon Translations Meaning YES / NO INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

13. COMMUNICATION = VERBAL x NON-VERBAL Contact zone Gestures & their impact on business Role of silence Role of eyes Gift giving & hospitality Business practice Role of education in a society INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

14. RELIGION Christianity European traditions Hinduismus way of living (life style): castes (privileged groups of society), common household of a few families, worship (cult) of cow Islam men preference in business INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

15. VALUES & ATTITUDES MASCULINITY x FEMININITY (Hofstede’s 1 of 5 dimensions): = is manner in which people are motivated to work toward different kinds of goals Masculinity People tend to place a high premium on material possessions, money & assertiveness The cultures that are more masculine, such as Japan, value competitiveness, assertiveness, ambition, and the accumulation of wealth. Femininity People place a higher value on social relationships, quality of life and concern for others On the other hand, feminine cultures, such as Sweden, place more emphasis on relationships, compassion, and the general quality of life. INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

16. Other culture aspects Time perception Contact zone Role of eyes Timing accuracy Politeness cca 80 cm in Europe cca 30 cm in e.g. Arabic countries Importance in Europe X could be perceived as a sign of agression in other parts of world (Asia, Japan) INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

Person’s beliefs about the relative importance of the individual & groups to which that person belongs INDIVIDUALISM x COLLECTIVISM SOCIAL orientation Power RESPECT x TOLERANCE POWER orientation Uncertainty ACCEPTANCE x AVOIDANCE UNCERTAINTY orientation AGGRESSIVE x PASSIVE goal behavior GOAL orientation (Masculinity x Femininity) LONG-TERM x SHORT-TERM outlook TIME orientation 17. Hofstede’s 5 dimensions of cult.differencies INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

18. Hofstede’s 5 dimensions SOCIAL ORIENTATION INDIVIDUALISM Cultural belief that the person comes first Key values: high degree of self-respect & independence COLLECTIVISM Belief that group comes first Typically: well-defined social networks, extended families, tribes, co-workers = person’s beliefs about the relative importance of the individual & groups to which that person belongs INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

19. Hofstede’s 5 dimensions POWER ORIENTATION RESPECT People tend to accept the power & authority of superiors People at all levels in firm accept decisions of superiors TOLERANCE People are more willing to question / refuse a decision or mandate from sb at a higher position = refers to beliefs that people in a culture hold about the appropriateness of power and authority dif. in hierarchies INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

20. Hofstede’s 5 dimensions UNCERTAINTY ORIENTATION ACCEPTANCE Stimulated by change and thrive on new opportunities Ambiguity is seen as a context one can grow, develop, carve out new opp. Positive response to change AVOIDANCE People dislike ambiguity and will avid it whenever possible Amb. & change seen as undesirable Preference of routine, structured & consistent ways of doing = is the feeling people have regarding uncertain an ambiguous situations INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

21. Hofstede’s 5 dimensions GOAL ORIENTATION / Masculine x Feminine AGGRESSIVE g.behavior (Masculinity) People tend to place a high premium on material possessions, money & assertiveness PASSIVE g. behavior (Femininity) People place a higher value on social relationships, quality of life and concern for others = is manner in which people are motivated to work toward different kinds of goals INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

22. Hofstede’s 5 dimensions TIME ORIENTATION LONG-term outlook Value: dedication, hard work, and thrift SHORT-term outlook Value: traditions, social obligations = is extent to which members of a culture adopt a long-term vs. short-term outlook on work, life etc. INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

-Culture and its impact on International Business -Characteristics of culture -Five dimensions of culture differences -Social orientation (individualism x collectivism) -Power orientation -Uncertainty orientation -Goal orientation (masculine x feminine) -Time orientation -Social stratification -Communication: verbal x non-verbal -Other culture aspects [time perception, contact zone, role of eyes, gift-giving, hospitality] 23. KEY terms INTERNATIONAL BUSINESS [B_IB] Ing. Pavla Břečková, Ph.D. /

INTERNATIONAL BUSINESS - BMCF / TM - winter term 2012 Thank you for your attention Ing. Pavla Břečková, Ph.D.