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

2.2. INTERNATIONAL BUSINESS – main areas Full-time course = 12 lectures per 90 mins. INTERNATIONAL BUSINESS [IB], characteristics, indicators. WORLD BUSINESS TERRITORIES, challenges, integration, main trading blocks [TRIAD, BRIC] GLOBAL BUSINESS ENVIRONMENT. EMERGING MARKETS, characteristics, features, selected markets in detail BRICS Doing business in ASIA Foreign market analysis PREDISPOSITIONS for working in IB, expatriation and HR in IB

EXAM terms N_IB 12 lectures (per 90 mins) - Finished by: exam Completion CONDITIONS = min. 12 points out of 30 Active participation in the lectures [active listening, discussing, reading, analyzing & interpreting of economic articles or case study results, presence at lectures – 50%] Case study elaboration & it’s active professional prezentation Knowledge test ALL BASED ON POINTS AS FOLLOW 5 points = 3/5 presence (if less = 0 points) up to 10 points = success at CASE study & its prezentation up to 15 points = TEST TOTAL max – 14 points = E 15 – 16 = D 18 – 20 = C = B 24 – 30 = A

CASE study / team project 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 / or other country 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? 4. PRODUCT PLACEMENT – market study Placing of a product into a foreign market, including product description + argument why it is suitable for export, analyses of the preferential market (why this market, structure and potential of the target group), mapping competition, potentials + risks, argument why you think your product will succeed.

CASE 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 a country 4. PRODUCT placement – market study ELABORATION:  Elaboration in teams up to 8 people  Presentation of the results - ppt possible, cca 15 min., structured way, clear outcomes (solutions, results) PREZENTATION: - up to 15 min. / all the team members should be involved

Team projects presentation - schedule 24/2/2014introductory lesson, setting the teams, choosing topics 10/3/2014consulting on the team projects 24/3/2014consulting on the team projects 7/4/2014guest lecture Steffen Schwarz – part of the course & test Entrepreneurship: Germany and Europe 21/4/2014Easter 5/5/2014presentation of teams, concluding the course

7.7. LITERATURE SOURCES Povinná literatura / Mandatory reading: Charles W. L. Hill: Global Business Today, McGraw-Hill/Irwin, 7th edition, 2011 Doporučená literatura / Recommended reading: Allan Sitkin, Nick Bowen: International Business, January Stuart Wall, Dr. Bronwen Rees: International Business: A First Course, September Wild, J., Wild, K., Han, J.: International business: the challenges of globalization. 4th ed. – Pearson, Upper Saddle River, ISBN: Woods, M.: International business. Basingstoke, Palgrave, ISBN: Griffin, R.W., Pustay, M.W.: International business: a managerial perspective. 5th int. ed. - Upper Saddle River, Prentice Hall, ISBN:

8.8. 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

9.9. 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 )

10. Basic elements of Culture CULTURE Language Communi -cation Religion Values & Attitudes Social structure

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 (collectivism) = 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

12. LANGUAGE = identified > languages worldwide Business language Form of language Competitive weapon Translations Meaning YES / NO

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

14. Ad COMMUNICATION - 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)

15. 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

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 16. 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

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.differences

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

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

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

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

22. Ad GOAL ORIENTATION Masculinity x Femininity (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.

23. 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.

-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] 24. KEY terms

INTERNATIONAL BUSINESS Thank you for your attention Ing. Pavla Břečková, Ph.D.