The paper "Cross-Cultural Issues in International Business" is a good example of business coursework. Intercontinental trade, increase in a number of Global Companies, technological expansion has risen as a result of globalization. Dramatic change has been brought about by the large number of Companies who are today dealing in international trade. People have as a result been brought together from different countries to interact as they expand and market their business. (Payne, 2010). By this statement, it means that the world has become connected towards one economy in spite of the boundaries across nations.
International competitors are eyeing the international market for opportunities that will increase the market share globally such that the domestic businesses are today neglected and ignored. Conflicts in business communication are as a result of a misunderstanding between two different cultures. The most significant problem will emerge when some people cling to an ethnocentric view stating in detail how they are supposed to conduct business. Gene, et. al, (2001) stated that according to a recent study done by KPMG revealed that in the majority of mergers and Acquisitions majority of approximately 83% were not beneficial to the shareholders and more than half of the Companies incurred losses of destroyed value.
The cause of these failures in the business mergers was found out to be cultural differences. This scenario is more common for Companies which are from two different countries, states of continents. In today’ s business arena Economic Integration and business culture are important concepts that are found in international Business. Economic Integration simply put means removing the barriers between business and economic activity. The Free Trade Area has opted to try and remove barriers among countries to enhance Business across nations.
Business culture, on the other hand, pertains the ethos of the business and how the staff act and think. Porter (2005), stated that the importance of acquiring another Company is synergy. In reality when two business units come together and integrate they will increase their competitive advantage against their competitor. The acquisition is also a way of increasing the expertise of the Company and the improvement of technology. The managers may be incubated and compelled to become more innovative due to the wealth of knowledge and expertise gained.
For instance, the Japanese model of management has been a great contributor to their rapid development if funding developing countries. The acquisition also ensures that economies of scale are achieved. Lodorfos, et. al, (2006). General Motors is one of the old and worlds most famous Car manufacturing Company whose brands include Vauxhall, Cadillac, Saturn, Hummer, Pontiac, Chevrolet and others. GM has spread globally forming global alliances with high stakes in Suzuki, Fiat Auto, Fuji Heavy Industries and Isuzu Motors Ltd. GM has had its ups and downs shedding un economical Companies and it has continued to retain its position as the world’ s leading maker of automobiles.
GM has for long been accountable, transparent and observed integrity which are some of the factors that helped it to grow as a market leader. This is because they have continued to value quality consistency, clear communication and provided their employees, suppliers, customers and dealers true information. GM has been involved in many Company acquisitions and in 1931; GM acquired Germany’ s, Adam Opel. S. Kim, (2011). With this acquisition GM aimed at acquiring a large market share of the small vehicles which are very popular in Europe.
The acquisition of Adam Opel comes with an increase in the provision of products and services to the greater community. Opel has been affected in the past by short- term financing and this has lead to poor profitability and a high-cost manufacturer. Opel has had the challenge for years and though the similarities between individuals are more than the differences, the negligible differences are far more apparent which overshadows the similarities.
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