Hofstede's Cultural Dimensions- Doc

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Nova Energy Drink
Table of ContentsINTRODUCTION...........................................................................................................................11. Hofstede's Cultural Dimensions.............................................................................................12. Cultural and legal barrier in Mexico......................................................................................2Impact of currency exchange rate...............................................................................................33. Identifying the positive and negative factors that are based on currency change...................44. Discussion on maintaining social responsible company in foreign market with socialresponsibility plan.......................................................................................................................55. Requirement of management infrastructure for entering and maintaining in new market.....6CONCLUSION................................................................................................................................6REFERENCES................................................................................................................................7
INTRODUCTIONIn the present competitive business environment, expansion of business in foreign marketis need for every company in order to attract more customer base and achieve more profitability.The present report is based on beverage manufacturer of U.S. , who planned to introduced itsprimary product Nova Energy drink in Latin American countries. The report will includestrategies in order to find the appropriate market throughHofstede's Cultural Dimensions andvarious barriers to enter the foreign market. Report will analyse the effect of currency onbusiness operations and need to maintain social responsibility in new markets.1. Hofstede's Cultural DimensionsHofstede's Cultural Dimensions is a framework, which provide idea of cross culturalchanges from one place to another. Also, it helps in measure the impact of culture on its valueand behaviour of members. It's key dimensions are Power distance index, Uncertaintyavoidance, Long-term orientation vs. short-term orientation, Masculinity vs. femininity,Indulgence vs. restraint etc (Hofstede, 2011). Following is the Hofstede's examination ofGuatemala and Mexico along with Average index score.Latin America scored high average points in Uncertainty Avoidance dimension, whichindicate the low of uncertainty among people. Here, people wants to control everything to avoiduncertainties. People are not conformable with change. To keep away the unpredictability theypractice strict rule, regulation and policies. Mexico remains at second position in Masculinityindex with 69th rank. Its represent higher gender distinction, country has more male dominatesociety. Mexico surpasses many neighbour countries in Power Distance index with 81 rank.Latin America countries has low average Individualism, this state people prefercollectivism in society (Minkov and Hofstede, 2011). They give importance to family,relationships, extenuated relationships and loyalty. Even, they take responsibility of fellowmember's actions. Guatemala got the lowest point individualism index (Rank- 6), in comparisonof average score (Rank- 21), but it has the highest points in Power Distance index(Rank- 95). Itshows there is high unequal distribution of wealth and power distribution in economy.1
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