Management Analysis for International Company Operating in Global Business Environment - Essay Example

Management Analysis for an International Company Operating in the Global Business Environment America vs. Brazil Name of Student: Student No: Date: Name of Supervisor: Introduction In this analysis, I will attempt to give a comprehensive overview of America and Brazil with a view to facilitating a smooth introduction of management staff to these economies. The analysis will cover pertinent socio-economic as well as political information for the two countries and the general business-operating environment. I will begin by giving an overview of the both America and Brazil and then move on to general information to do with country demographics, economy, and people. Finally I shall look at the business environment in terms of how conducive the country is to global companies, how to manoeuvre within that environment in order to gain maximum advantage and how best to fill in the gaps that may present an opportunity. This knowledge is pertinent in order to enable a smooth transition into these new environments. America vs. Brazil, a Discussion When businesspeople find themselves in an international environment for the first time, they take a moment to acclimatise. The contrast between this new environment and the one they are used to is often intricate and substantial. Some are immediately apparent such as a difference in language, legal tender, and lifestyle. Other changes are less obvious, and are very subtle, complicated, or concealed. In order to succeed in international business, it is crucial to comprehend the myriad cultural, socio-political, economic, and legal characteristics of different jurisdictions. The United States was founded on the principles of equality for all and is today a melting pot of multicultural heritage consisting of over 300 million people. There is a robust identification with regional and ethnic origins in American culture, illustrated by the myriad subcultures that exist as a consequence of the immense geographical reach and regional variances. Global business culture has felt the unmistakeable stamp of America’s influence but it is important for business pundits intending to conduct business within the States to understand the various cultural dynamics that lie beneath the surface (Gorrill, 2009). Brazil on the other hand has a business environment that is as rich and diverse as the country. Although its surface area can accommodate the entire United States with the exception of Alaska, its population is only about 200 million and its language and culture is influenced by Spanish, German, Italian, Portuguese, and African contributions among others (Moreira, 2010). Political and Legal The political system of the United States is based on two fundamental documents, that is the Declaration of Independence of 1776 and the Constitution of 1789. These are the building blocks of the United States federal government. The former sets up the United States as an autonomous political entity while the latter forms the framework for the federal government. The nucleus of the US constitution embodies separation of powers, which translates into the three arms of the state; that is the executive, the legislature and the judiciary spread the power between them in order to avoid too much power being concentrated in one pair of hands or institution. No one person can belong to two arms of government. This provides checks and balances to the governing bodies. Furthermore, the different branches enjoy varied terms of office. The president serves for four years while the Senate has a six-year term. Members of the House of Representatives serve for two terms. The Supreme Court on the other hand, has lifetime members (Darlington, 2012). Brazil is also a Federal Republic and has been so since 1985. It is made up of 26 states and a federal district. The states are further subdivided into five regions which are the North, North East, Central West, South East, and South. The legislative bodies consist of the Federal Chamber of Deputies consisting of 513 seats and the Senate which has 81 seats. Each state has a unicameral legislature as well as the federal districts. The president is elected for a four-year term for a maximum of two terms (Moreira, 2010). Economy The economy of the United States is dependent upon an amalgam of distribution technology for goods and services, labour and natural resources. It is the largest global economy and is said to be the most efficiently run. The American population constitutes 5% of the world’s total but generates 23% of its economic production. According to the World development indicators for 2011, the total GDP for the U.S. in 2010 was 14.6 trillion USD. The United States labour force is made up of an amalgam of job types which are classified according to the North American Industry Classification System (NAICS). This s the standard classification used to categorise businesses all through continental United States. There are twelve main industry categories known as super-sectors which cover all private and public jobs both in the country and those operated by U.S. multinationals. These twelve super-sectors are construction, education and health services, government, financial activities, information, leisure and hospitality, manufacturing, natural resources and mining, professional, and business services, other services, transportation, and utilities and wholesale and retail trade (library index, 2012). The Brazilian economy is divided into a substantial agriculture, mining, manufacture, and service industries that are well developed. The Brazilian ever-growing economy overshadows that of its South American contemporaries and Brazil is an ever-expanding presence on the world market and it ranks tenth on the world economy. Brazil has undergone many challenges over the years such as a military dictatorship between 1964 and 1985 among others. Like other countries, the recession has been a challenge to the economy but it did not last as long as elsewhere and recovery is ongoing. Many multinationals continue to invest in the country and the government has devoted 300billion to upgrading infrastructure in preparation for the World Cup to be held in 2014 and the Olympics in 2016. This creates a conducive environment for foreign investment (Moreira, 2010). Culture The U.S culture emphasises individualism over collectivism. A majority of Americans live by this premise, which encompasses personal initiative and achievement. Self-sufficiency and independence are highly prized attributes that seep into places of work. Therefore, status in society is therefore determined by one’s own efforts and not by class or age. They are also a low context culture which means communication of meaning or data is done unequivocally through verbal skills. The focal point of American attitude is achievement of tasks and thus the main aim of communication is to pass on information, share facts, or opinions. Egalitarianism is key in American culture. They value the concept of equality in terms of rights, social obligations, and opportunities. This means that greater wealth, age or social status is no guarantee of deference (Gorrill, 2009). In Brazil on the other hand, business is conducted via networking and being introduced by a mutual acquaintance is important. Who you know is more important than what you are selling. Brazilians are very tactile and indulge in a lot of physical contact, while the hand signal for ‘okay’, while used a lot in the States, is rude in Brazil. Brazilians do not like to get to the point right away. It is considered offensive and aggressive – it is necessary to indulge in social chitchat first, be acquainted with the person first before finally getting down to business. Brazilians, unlike Americans are not automatically on first name basis. One must be invited to address the other by their first name before doing so. Punctuality is another difference between Brazilians and Americans. While Americans expect their meetings to start on time the Brazilians are not time conscious (Moreira, 2010). Moving to America As companies undergo international expansion and breach global barriers, there is increased migration of people to different jurisdictions. This involves meeting new people and adjusting to the new culture. When moving to a new country with one’s family when you do not speak the language it is important to have as much preparation as possible. Moving with a spouse and two pre-school age children means that the focus has to be on housing, obtaining as much help in manoeuvring around the system as possible and adapting to the new country as fast as possible. This can be done by obtaining as much information as possible about the place. The United States is a melting pot of cultures and although the official language is English, Spanish is also spoken quite widely and other languages as well. The first priority is to obtain visas for the family. This application and interview process takes place at the U.S Embassy. There is a non-refundable fee attached and the immigrant must allow for at least a 30-day allowance before going for the interview and an equivalent period to allow security intelligence to be carried out. This process must be completed before a visa is issued. For applicants who do not speak English, it is very important that the paper work is in correct order so as to minimise questions that must be answered. In this case, the type of visa required is an L-1 Status OR Intra-company transfer visa for the primary applicant. This visa is for foreign entities that have operations within the United States. They are allowed to temporarily transfer essential workers into the States such as technical staff, managers, and executives. These employees must however have been with the company for at least a year within the last three years before the petition was filed. The L-1 status is good for seven years divided into smaller units of time, in U.S. employment should the nature of the job, and the individual comply with minimum standards of qualification. Application is done via USCIS by mail with a filing fee of 190USD and fraud detection and prevention fee of 500USD. It takes a maximum of ninety days for a decision to be made. The spouse and children of an L-1 approved visa applicant are eligible for L-2 status. This is advantageous for the spouse because it is possible to obtain proper authorisation to get a job (Katzman, 2006). Once in the States, it is important to be aware of one’s civil and legal rights. According to the United States Department of Justice (2008), it is illegal to discriminate against a person based on their national origin, race, colour, disability, sex, religion, or family status according to Federal laws. There is legislation that prevents a person being discriminated against because of their nation of origin, such as birthplace, culture, ancestry, or language. It is also important for the family to become acquainted with American culture as it pertains to their everyday living. This involves knowledge of the individualism, egalitarianism, and low context culture that defines American life. For the purposes of business, it would be wise to enrol in English as a Foreign Language classes in order to be able to communicate. This is because English is the international language of business and working in a multinational firm requires that one should be able to speak the language. For the primary employee, it is important to understand the American consumer. It is important that consumers continue spending to facilitate economic growth. This spending is dependent upon employment and interest rates, factors which are interdependent. When the latter are low, then consumers tend to spend more money, which leads to greater job creation. When there is people are in stable employment, they tend to spend more money. However, low interest rates also lead to more debt as was seen in the early 2000s, with consumers taking out car loans, home equity loans and piling credit card debt. Without concurrent job increases, estimated at an average of 300000 new jobs every month, then the economy cannot be sustained (Uchitelle, 2003). For this reason it is important to understand the dynamics of consumer spending in order to ensure success. The difference in culture may be a source of frustration, and may even lead to culture shock. However, this could be avoided by accumulating as much research information as possible about the new country. It is also advisable to participate in activities that resonate with you and that are familiar to you as an immigrant. This will help in finding common ground between your own culture and that of the host country. This could include food, music or other aspects of culture. Because the children are pre-schoolers, it is not necessary to look for schools for them but it may be advantageous to source for playgroups in which they can interact with other children, learn English, and facilitate their adaptation to their new environment. The interaction of the spouse with other parents in the playgroup will assist them to socialise faster to the new environment, and facilitate networking which could be advantageous in the business. As stated earlier, it is also important to enrol in an English and/or Spanish language course to facilitate communication with the core consumers of the company product. This will also assist to avoid feelings of isolation in the new environment due to inability to communicate with anyone outside of the family circle. There will inevitably be challenges encountered in the course of the adjustment to the new environment. For that reason, it is important that one is familiar with one’s rights and privileges within the new society so as to know when these are violated. This includes violation of civil rights such as refusal or deferral of service from a public or private entity due to inability to speak in English. The United States Department of Justice (2008) gives a few examples of this in order to illustrate what is illegal according to Federal laws. One example is the refusal of service by a restaurant or hospital to non-English speaking consumers, in preference to English speaking ones. Finally, once settled in, in the States, it is important to make sure that one’s papers are in order including the Social security card and work permit. These documents should be kept close at hand at all times in the event of trouble or any situation in which authorities would want to have a look at them. Conclusion America and Brazil have many things in common including mode of government, surface area of the country and economic resources. Their culture however, is diametrically opposite. The Americans are a low context culture who uses words to pass on information and communicate essential details. Brazilians on the other hand, are a gregarious people who value conversation as a tool to get to know their business partners before conducting any type of business. To migrate to these countries therefore would require cultural adjustment of very different kinds. Migrating to America is a more businesslike proposition, ensuring that all one’s papers are in order, and once there, complying with the laid down strictures that enable entre into polite society. That means joining in social groupings, adjusting to the language needs and acclimatising to local and federal laws. Once that has been accomplished, how one is judged would depend on one’s own efforts and achievements. References Darlington, R. (2012). A Short Guide To The American Political System. Retrieved from: http://www.rogerdarlington.me.uk/Americanpoliticalsystem.html Gorrill, J.R. (2009). Doing Business in the United States of America | US Social and Business Culture; A US Culture Overview. Communicaid. London Katzman, A. (2006). Doing Business in the United States of America. Garvey, Schubert and Barer. Beijing. Library index. (2012). Economic Sectors - The Twelve Sectors: Overview. Retrieved from:http://www.libraryindex.com/pages/1264/Economic-Sectors-TWELVE-SECTORS-OVERVIEW.html">Economic Sectors - The Twelve Sectors: Overview Moreira, D. (2010) Doing Business in Brazil. UHY International auditors. Porto Alegre, Brazil. The American Consumer - Consumer Spending, Job Creation, And Interest Rates - Growth, Economy, Jobs, and Employment. Retrieved from:  http://www.libraryindex.com/pages/1308/American-Consumer-CONSUMER-SPENDING-JOB-CREATION-INTEREST-RATES.html Uchitelle, L. (2003). “Why Americans Must Keep Spending”, New York Times, December 1. United States Department of Justice. (2008). Federal Protections Against National Origin Discrimination. Retrieved from: http://www.justice.gov/crt/publications/natorigin2.php Appendix: Key economic and demographic details   America Brazil Government style  Federal Federal Population (million)  313,232,044 (July 2011 est.)  203,429,773 (July 2011 est.) Current GDP per capita (US$)  $47,390 (2010)  $9,390 (2010) GDP (US$ billion)  $14,586,736,313,339 2010  $2,087,889,553,822  2010 Growth rate of GDP  3%  7.5% Inflation rate  0.8%  7.3% Unemployment rate  Female 8.1% (2009) Male 10.3%  Female 11% (2009) Male 6.1% Labour force  139.1 million (2010)  103,600,000 (2010) Expenditure on education  5.5% of GDP (2007)  5.08% of GDP (2007) Literacy level  Definition: age 15 and over can read and write  total population: 99%  male: 99%  female: 99% (2003 est.)  Definition: age 15 and over can read and write  total population: 88.6%  male: 88.4%  female: 88.8% (2004 est.) Languages spoken  English 82.1%, Spanish 10.7%, other Indo-European 3.8%, Asian and Pacific island 2.7%, other 0.7% (2000 census)  note: Hawaiian is an official language in the state of Hawaii  Portuguese (official and most widely spoken language)  note: less common languages include Spanish (border areas and schools), German, Italian, Japanese, English, and a large number of minor Amerindian languages Religion/s  Protestant 51.3%, Roman Catholic 23.9%, Mormon 1.7%, other Christian 1.6%, Jewish 1.7%, Buddhist 0.7%, Muslim 0.6%, other or unspecified 2.5%, unaffiliated 12.1%, none 4% (2007 est.)  Roman Catholic (nominal) 73.6%, Protestant 15.4%, Spiritualist 1.3%, Bantu/voodoo 0.3%, other 1.8%, unspecified 0.2%, none 7.4% (2000 census) Other important facts  Population growth rate 0.963% (2011 est.) Sex ratio at birth: 1.047 male(s)/female  under 15 years: 1.04 male(s)/female  15-64 years: 1 male(s)/female  65 years and over: 0.75 male(s)/female  total population: 0.97 male(s)/female (2011 est.)  Population growth rate 1.134% (2011 est.) Sex ratio at birth: 1.05 male(s)/female  under 15 years: 1.04 male(s)/female  15-64 years: 0.98 male(s)/female  65 years and over: 0.73 male(s)/female  total population: 0.98 male(s)/female (2011 est.) Read More