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4.1 What three important developments of globalization will probably affect me?
First, the rise of the “global village” and electronic commerce will affect consumers
worldwide. Making purchases online used to be a unique way to shop, but is now
4.2 Why learn about international management, and what characterizes the successful
international manager?
Studying international management prepares managers for working with foreign
4.3 Why do companies expand internationally, and how do they do it?
Multinationals expand to take advantage of availability of supplies, new markets,
lower labor costs, access to finance capital, or avoidance of tariffs and import
CHALLENGE: MAJOR QUESTIONS
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4.4 What are barriers to free trade, and what major organizations and trading blocs
promote trade?
Barriers to free trade are tariffs, import quotas, and embargoes. A tariff is a trade
barrier in the form of a customs duty, or tax, levied mainly on imports. An import
4.5 What are the principal areas of cultural differences?
The principal areas of cultural differences are language, interpersonal space,
communication, time orientation, religion, and law and political stability. First, there
are thousands of languages spoken around the world, and just knowing English
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1. What are the biggest challenges Norweigan experienced in trying to expand its
airline across the globe?
Some of the biggest challenges include a potential strike by 600 pilots. This was
because Norwegian was planning on outsourcing its flight staff to Thailand and
2. To what extent did you observe examples of ethnocentric, polycentric, or
geocentric attitudes in this case? Provide examples to support your conclusions.
One example of ethnocentrism is from the Air Line Pilots Association
3. Use Table 4.4 to identify cultural differences that are likely to arise between
Norwegian employees working in Denmark and Sweden and Thailand. How
might these differences affect interpersonal interactions, and what can the
company do to reduce any unintended conflict from these differences?
A big difference is in power distance, which expresses the degree to which a
society’s members expect power to be unequally shared. Norwegian employees
MANAGEMENT IN ACTION:
Norwegian Air Shuttle Aspires to Become the Cheapest Global Airline
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4. What are the most important lessons to be learned about global management
from this case? Discuss.
It is important to note that globalization and technological advancements in air
travel has allowed Norwegian to become a global version of Southwest Airlines.
Chapter 04 – Global Management: Managing Across Borders
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Should Families of Passengers on Malaysia Flight 370 Be Allowed to Sue for
Damages in the U.S.?
This challenge revolves around the mysterious crash of Malaysia Flight 370 en route
from Kuala Lumpur, Malaysia, to Beijing: To date, no remains of the plane have been
SOLVING THE CHALLENGE:
Do you think lawyers should encourage families to sue Boeing in the U.S.?
1. No. There is no evidence that Boeing was responsible for the crash, and people
should get what they can from Malaysian Airlines.
There is frankly no evidence that Boeing was not responsible for the crash either.
Though Malaysian Airlines is ultimately responsible unless a mechanical problem
2. No. Such suits should be filed in the country in which the accident occurred.
According to the Montreal Convention, claims against the airline or the
LEGAL/ETHICAL CHALLENGE
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3. Yes. This is a tragedy and families should get all they can.
In such tragedies and knowing that multiple insurance companies may be
4. No. Malaysia Airlines has agreed to pay at least $5,000 to each family. Also,
large settlements might bankrupt Malaysia Airlines and the Montreal Convention
provides damages for passengers on international flights.
First, the Montreal Convention does not allow for the amount of damages a US
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Objectives
• To raise your awareness regarding appropriate behavior in different nations.
• To emphasize that different nations have truly different customs.
Introduction
Globalization means that people in business must know the customs of other nations. A
mistake can alienate a potential business partner; rudeness, even if unconscious or
Instructions
Divide the class into teams of five students. Everyone in each team should individually
try to match each of the following countries to the custom/gesture described in the list
below. Then score choices according to the answer key at the end of this exercise.
After each team member has individually completed his or her answers and scored
them, compare them and then share your results with other teams in the class. Which
items were incorrectly matched the most times? What do you think are the reasons for
this?
Country Custom/Gesture associated with each country
1. Chile _____
2. France _____
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Gesture/Custom
a. Never show the bottom of your foot; it is considered offensive.
b. While imported liquor is appropriate, a gift of locally available wine can be
interpreted as saying that your host’s wine cellar is inadequate.
f. At a meal, keep your hands above the table at all times.
g. Men greet each other with a slight bow and sometimes an accompanying
handshake while maintaining eye contact.
h. Press your hands together as though in prayer, keeping arms and elbows close
to your body, bow your head to touched fingers, and say Wai (pronounced
“why”).
Interpretation & Scoring
If you matched the correct country with the correct gesture/custom 8–10 times, you are
very cosmopolitan, or international; if you matched the correct country with the correct
gesture/custom 4–7 times, you are moving toward becoming cosmopolitan; if you
matched 0 to 3 accurately, you probably need to read more about other nations and
travel outside the United States.
Group Exercise Answer Key
1 = f
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Questions for Discussion
1. What does it mean to you to be cosmopolitan or international? Explain.
2. Do you believe that it is important to know about diverse cultures? Why or why
not?
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Not M
Not Made in the U.S.A.
Teaching Objective: To illustrate how individuals participate in the global economy
Summary: An American family goes for an entire year without buying products made in
China, the largest exporter of goods to the United States. They learn the extent to which
Questions:
1. How does this video illustrate the global economy?
Answer: The video illustrates different levels of the global economy, which
involves the movement of goods, people, and money through the world. It
2. Why are goods from China often priced lower than they would be if made in other
countries?
Answer: Because labor is dramatically cheaper in China than in the United
States, suppliers there can make and sell goods at lower cost. Many American
3. Do you think many Americans are concerned about where products are made?
Do you know anyone who checks the country of origin before buying something?
Answer: Students will have different opinions or experiences to relate. However,
Additional videos directly related to the textbook can be found in the
Connect Instructor’s Manual.
VIDEO CASE
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Students may complete the “Cultural Differences: Let’s Break a Deal” Manager’s Hot
Seat exercises in Connect for this chapter.
I. Introduction
The internationalization of companies has created the need to become more
aware of cultural differences in order to successfully conduct business. This
II. Learning Objectives
1. To assess students’ understanding of different cultural values and their impact on
III. Scenario Description:
Overview: Michael Sokolow has just been tasked with handling international
clients. He needs to close a deal with Norio Tokunaka from PopWear that has
already been thoroughly worked out with Sokolow’s predecessor, Roger Small.
Michael is unaware of the need to establish a relationship with Norio before he
discusses business. Norio becomes disenchanted and refuses to sign the deal.
Profile:
• Michael Sokolow is the Director of Foreign Sales at Mustang Jeans. After
References: The references included in the DVD are:
• National Cultural Values (PPT 8-3)
MANAGER’S HOT SEAT
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• Hofstede’s Model: Definitions (PPT 8–4)
• The Johari Window (PPT 8-10)
• The Johari Window: Definitions (PPT 8-11)
Back History: Michael Sokolow has been a sales manager at Mustang Jeans
for two years. He was “recruited” or “wooed away” from a competing company.
Tokunaka has been with PopWear for his entire career. He has been working
with American companies for many years, importing a variety of products. Most
of these American companies are alliances that were formed by Tokunaka’s
superiors, many years before. All of Tokunaka’s accounts are pre-existing
accounts as opposed to newly created accounts. This year, PopWear is
Scene Set-up: Norio arrives at Michael’s office after arriving from Japan.
Scene Location: Michael’s office at Mustang Jeans corporate headquarters
The Meeting – Summary: Michael spends less than a minute building rapport
with Norio. He then begins to talk about signing the deal that had been
3 Days Later – Norio comes back and Michael apologizes for the prior meeting.
When asked to sign the deal again, Norio suggests that he’s been talking to other
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Afterthoughts – Summary: Michael notes his frustration with the interaction.
Dossier: The specific artifacts included in the DVD are:
1. Emails between Small and Sokolow after the 1st meeting
2. Small’s PopWear Account Notes
3. Voice message to Norio Tokunaka from Slo-Groove (competitor of
Mustang Jeans)
IV. Discussion Questions:
The References and related Discussion Questions may be found in PowerPoint slides
8-1 to 8-11.
Learning Objective #1: To assess students’ understanding of different cultural values
and their impact on business relationships.
1. How did the differences between Japan’s and the United States’ national cultural
values affect the interaction between Norio and Michael? Use the information on
PPT 8-3 and 8-4 to support your answer.
Long-term orientation differences seemed to have a major impact. While Norio is
2. Hofstede’s research on national cultural values has practical implications for
business people. Assume you are Michael and you have to conduct a similar
meeting with another client from Russia. How will you modify your behavior to
effectively conduct business with this individual? Use the information on PPT 8–3
and 8-4 to support your answer.
1. What is Michael’s strategy?
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2. How was this [initial] meeting?
A. Successful
B. A failure
C. A good start
Learning Objective #2: To analyze and evaluate a cross-cultural business meeting.
1. What information should Michael have possessed before his meeting with Norio?
Michael should have been better prepared by Roger as to what to expect from
2. Why is Norio acting somewhat evasive with his responses?
Even though the deal was almost done, Norio was expecting to now build a
3. What is Norio hinting [when he mentions Roger likes sushi]?
A. Misses Roger
3. What could Michael have done better in the second meeting to continue the
business relationship?
Learn more about the cultural differences at play. He also could have tried to
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4. Norio is indicating [when he says he’s been meeting with other people]:
A. There’s competition
B. He enjoyed trip
C. Deal is off
He’s suggesting that there is competition but Michael doesn’t seem to
5. Michael’s concern [that they are having a communication problem] is:
A. Accurate
4. Both individuals in this scenario were acting in alignment with their cultural norms
and values. Who should have the primary responsibility for changing their
interaction style? When is it “too much”, as Michael suggests in the
Afterthoughts, and necessary to refuse to change one’s business style?
This question should generate an interesting discussion among students. Some
Learning Objective #3: To explore aspects of self-awareness using Johari’s Window as
a model.
1. Apply the concepts of the Johari Window to this scenario (see PPT 8-10 and 8–
11). How do these concepts help explain what happened in this scenario?
As relationships progress, more information about oneself becomes known to
6. Michael should [when Norio says “I’m sure we’ll have a good
relationship in the future”]:
A. Be angry
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