SBLC7015: Cross-Cultural Management in Global Business - Bufori Report

This report examines cross-cultural management principles within the context of Bufori Motor Car Company, a Malaysian automotive manufacturer, aiming to expand into the United Kingdom. It delves into the significance of managing global business operations to mitigate potential challenges. The report highlights the importance of identifying opportunities and risks associated with operating in a global environment. It differentiates between high and low context cultural environments, emphasizing the need for companies to analyze these differences before entering new markets. The report includes a literature review and critical analysis of these topics, discussing strategies for effective global business management, including market research, innovation, and selection of appropriate entry strategies. It also provides recommendations for Bufori to achieve cross-cultural proficiency, considering the shift from a high-context Malaysian culture to a low-context UK environment. The report underscores the importance of understanding government regulations, employee training, and environmental factors to ensure successful international expansion.

Cross Cultural Management
in Global Business

EXECUTIVE SUMMARY
The below mentioned report is based upon Bufori Motor Car Company which is a
Malaysian automotive organisation. The following report revealed that managing global business
is important in order to prevent the company from encountering any difficulty at global level.
Further, it is recognised that entity needs to identify the opportunities and risks associated with
operating in a global context. Besides this, low context and high context market have their own
characteristics and attributes that should be identified and analysed by an organisation before
seeking to gain entry into any of these cultural environments.

Table of Contents
EXECUTIVE SUMMARY.............................................................................................................2
INTRODUCTION...........................................................................................................................1
Literature Review-& Critical Analysis............................................................................................1
Effective management of potential opportunities and risks of doing business in a high context
v/s low context cultural environments....................................................................................1
Managing global business......................................................................................................2
Discussion and analysis...................................................................................................................3
Effective management of potential opportunities and risks of doing business in a high context
v/s low context cultural environments....................................................................................3
Managing global business......................................................................................................4
Conclusions......................................................................................................................................6
Recommendations about how firm can achieve cross cultural proficiency.....................................6
REFERENCES................................................................................................................................8

INTRODUCTION
Cross Cultural Management is defined as the concept linked to the management of
functioning of business in cross culture context. This concept includes gaining comprehensibility
of the impact placed by the societal culture upon the manager of company together with the
practices adopted by them for the purpose of management (Patel, 2013). The present project is
based upon Bufori Motor Car Company based in Kuala Lumpur, Malaysia. BUFORI is an
acronym which stands for B – Beautiful, U – Unique, F – Funtastic, O – Original, R – Romantic
and I – Irresistible. It is a hand built automobile organisation which comes up with new models
and features in accordance with the demands of people in market place. The management of this
entity has proposed to facilitate expansion within the market of United Kingdom looking upon
the country’s economic growth and development. The project consists of literature review and
discussion done over two topics that are opportunities and risks of operating in high v/s low
context cultural environment along with ways in which global business are managed. Further, it
includes recommendations exploring the ways in which an entity can attain cross culture
proficiency.
Literature Review-& Critical Analysis
Effective management of potential opportunities and risks of doing business in a high context v/s
low context cultural environments
The terms "high context" as well as "low context" as popularized by Edward Hall are often used
for describing the cultural differences underlying between the societies. In this relation, it has
been acknowledged that high context cultural environment refers to the countries whereby
people tend to have close relationships over a passage of time. The behavioural conduct hereby is
not found to be explicit as people hereby have known and talked to each other since ages. On the
contrary, low context cultural environment can be referred to as the nations whereby people
strive to have relations but either for a particular reason or for a short run (French, 2015).
Hereby, the cultural belief as well as the behavioural conduct is require to be explicitly spelled so
that the companies seeking entry into such culture knows the way in which they can ensure their
long term sustainability in market place. Low context and high context cultural environments as
per Edward Hall thus have their own characteristics which make them distinct from each other.
In the same manner, both the cultural environments have their own opportunities and risks
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associated with them which need to be taken into account by any company which seeks to gain
entry into either of the two or both of them while functioning in a global context.
Managing global business
As per the views as well as opinions of Johnson and Cullen (2017), expanding into a new market
and operating in a global context is not an easy task for any company. In this relation, it has been
identified that an organisation needs to leverage strategic course of action and a number of
strategies in order to ensure that it does not face any difficulty in operating at global level.
Keeping up to date knowledge of the top notch players in market together with the key trends
pertaining to the concerned sector becomes necessary when an entity decides to facilitate
expansion within any other national territory.
In this regard, it is important for the organisation to have knowledge of the cross cultural
environment in order to devise strategies through which the attention of people in new market
can be gained towards the products and services offered by the entity at global scale. In order to
attain a top position at global scale, it is important for an enterprise to maintain the same
excellent performance as was seen in the domestic market. This will ensure a bright future for
the company and guarantee its long term sustainability at market place. In this relation, it has
been acknowledged that there are a number of strategies that can be adopted by an organisation
to effectively function at the global level. Such strategies are discussed as beneath:-
Constant market research: It is important for an organisation operating at global level or
seeking to do the same to conduct constant market research. This provides assistance to the
company in identifying the trends and patterns that have been prevailing in market place in
relation to a concerned corporate sector (Patel, 2013). This implies that the entity would be able
to gain knowledge of the top market players and the strategies adopted by them. By gaining this
knowledge, the corporation would be able to gain an upper hand and come up with products,
systems, services and technologies that can appeal to public prevailing within the confines of
new markets.
Innovation: It is crucial for the management of a company to realise the significance of
innovation especially when it is currently operating on a global level or seeking to do so in the
near future. Innovation provides assistance to an enterprise in tapping the mindsets of individuals
prevailing within the confines of new market and gaining their attention towards the products
and services offered by the organisation. Further, it has been analysed that innovation provides
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aid to the entity in appealing to a large number of individuals. This happens by incorporating
something new within the existing offerings so as to make the offerings of company different
from that offered by other organisations in market place. Innovation provides a competitive
advantage to the firm and helps it in sustaining in market place for a long period of time in future
context.
Selection of entry strategy: Seeking entry into a new market is not an easy task. It requires
effective and strategic planning. In this relation, it has been identified that one of the most
important parts of this planning is deciding the market entry mode which would be opted by the
enterprise that will be the most advantageous for corporation to sustain at global level in the long
run (Moore, 2015). There are several options available for an organisation such as joint venture,
licensing, franchising, direct export, indirect export and many more. The selection of right
market entry strategy can open doors of success for the organisation and help it in appealing to
the residents of the new country in an effectual manner. This would imply larger customer base,
thereby resulting into more of revenues and profits for the corporation.
Macro environmental screening: The environment within which a business entity tends to
operate has a large scale impact over its overall functioning. Thus, it becomes important for the
management of an organisation operating at a global scale or intending to do so, to identify and
analyse the different elements of external or macro environment (Gehrke and Claes, 2014). Such
factors include political, technological, legal, environment, socio cultural and economic. The
screening of these factors provides aid to an entity in gaining knowledge of the opportunities and
risks that are linked to operating at a global scale. Whereby the entity identifies any threat or
risk, it can devise an effective course of action in order to address and tackle it. This will render
aid in gaining an upper hand over the rival firms and ensuring long term existence in global
market place.
Discussion and analysis
Effective management of potential opportunities and risks of doing business in a high context v/s
low context cultural environments
Gaining comprehensibility of the characteristics of the cultural environment in which an entity
seeks to gain entry is very important. In this regard, the top management of Bufori seeks to
expand from Malaysia into UK. It has been recognised that Malaysia is a high context country
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while UK on the other hand is a low context country. This implies that the facilitation of
expansion of the concerned automotive company from Malaysia to UK would not just account
into market expansion but into a shift from high context to low context cultural environment.
This makes it important for the management of Bufori Motor Car Company to take into account
the opportunities and threats of operating in a low context country in order to ensure that it can
gain an upper hand over the rival firms in the same market place. Also, it would inflate the scope
for the company to sustain in United Kingdom for a longer period of time by devising effective
strategies through which the risks of low context cultural environment can be duly tackled. With
respect to this, it has been identified that UK is a country whereby people maintain short run
relations or relation for a specific reason or activity. The population of UK is more of rule
oriented and the knowledge hereby is more often transferable. Thus, the management of Bufori
also needs to take into account the fact that the people of this nation are keen on putting the tasks
and activities first as they are task centred. They emphasize on dividing the responsibility as this
would result in timely accomplishment of the goal. However, this even poses the concerned
automotive company to the risk of short lived relations that the employees within the new
country may intend to maintain with the entity.
Managing global business
Effective management of business while making its expansion in other geographical area
is an essential aspect that requires formative strategy and a strong business plan in order to drive
corporate success in an effective manner (Tran, 2016). In this entity is required to set long term
and short term strategy in order to analyze different factors like taxes or regulations,
competitiveness and potential distribution channels in order to ensure maximum success. Bufori
operates their functioning as a successful manufacture of handcrafted motor cars. This
company’s main motive is to preserve art of traditional automotive craftsman’s and serve
consumer needs in best effective manner. Company is looking forward to expand business in
United Kingdom. For this it is important for respective organization to consider some certain
important aspects in order to gain opportunities to expand target audience and navigate foreign
markets in an effective manner:
Government rules and regulation in every nation or country are distinct. It is essential
for an organization to analyze stability of present government in order successfully expand their
business (Thomas, 2015). This is most important aspect that affects entity internal as well as
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external operations. In this it is essential for Bufori to consider key aspects of United Kingdom
likes communication and transportation options, immigration and impairment laws, access to
affordable capital, protection policy for business, government assistance program for business,
access to needed resources and materials and currency exchange rate. All these factors have
significant impact upon business activities. Thus by having proper knowledge and information of
the UK laws before expansion Bufori can sure success of their expansion plan in United
Kingdom and can conduct their activities in a smooth manner.
Proper and effective training to employees is an essential factor that is required to be
considered by an organization while they are looking for expansion in other graphical location.
In this it is essential for Bufori to provide proper and effective training and development courses
to their existing and newly hired employees in order to make them compatible with entity values
mission and goals. By offering them training can not only benefit and take to increase their
performance but can also benefit to satisfy consumers with effective services. In this entity can
train their employees with native language and culture differences in a well effective manner. In
addition with their respective company is required to continuously engage in the process of
finding new talent and fill talent gaps in order to increase workforce efficiency and production of
organization. In order to provide training entity by taking advantage of effective communication
technology and Hi-Tech innovative network can increase performance and productivity of
employees at great extent.
Close Relationships with Local Businesses will be maintained by the company. Local
business is main backbone of a country economy as it provides raw materials and services to
large scale organization at a reasonable cost. Thus in order to ensure your maximum competitive
advantage in respective industrial sector it is essential for an entity to establish close effective
relationship with local businesses (Thomas and Peterson, 2016). In context with Bufori, by
developing formative and effective relationship with local business operating their functioning in
United Kingdom province, respective firm can maximize its overall profitability generating
capacity. In this company develop strong internal alliance as to manage and foster relationship
and develop effective business model in order to expand their services in UK. With the help of
this relationship Bufori can negotiate different partnership and distribution programs and can
take advantage of great opportunities for growth. This significantly increases growth
effectiveness as it is most essential aspect. As by ensuring long lasting business relationship with
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local businesses Bufori can widen their profitability and productivity index and can serve large
base of consumers.
Conclusions
On the basis of literature review and discussion done above, it can be said that market
cross cultural management renders aid to the top management of an enterprise in addressing the
differences that lie between the domestic as well as host market. In this relation, it is important
for an organisation to gain knowledge of the ways in which business can be managed in a global
context. In addition to this, it has been analysed that there are several opportunities and risks
associated with operating in a low or high context culture country. These need to be identified in
an effective manner so as to select the country for facilitating market expansion. Besides this, it
has been acknowledged that devising appropriate strategies is essential to manage global
businesses in an effective manner.
Recommendations about how firm can achieve cross cultural proficiency
On the basis of overall information provided in the above report, it has been analysed that
businesses often takes various steps for attaining success at national as well as international
marketplace. With reference to the current scenario, it has been determined that the Bufori is
expanding its business in UK market with the motive of business expansion as well as enhance
their profit figures. According to the overall information attained from the overall report, there
are few recommendations provided to business manager of Bufori which will provide support to
them in easily expand their business in UK and maximize their efficiency of business operations
as well as profitability. Some of the main recommendation provided to the manager of the
respective company is specified as below in detailed manner:
 At first it is recommended to manager of Bufori to develop effective policies with the
inclusion of appropriate code of conduct so that they can effectively expand their
business in UK. It can be further said that by making appropriate and ethical policies it
would be easier for the top management team of this company to handle their operations
in UK. Also, it will clearly keep them away from any kind of legal obligations from the
near future.
 At next, it is advised to the business manager of Bufori to conduct few training and
development session for their employees so that they can easily groom themselves
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according to the requirement of their core businesses. In these training employees will get
training about the new work and skills that are highly important to be learned by them so
that they can easily attain their respective goals and objectives. This will finally
contribute in gaining the competitive edge new market as their employees are highly
skilled and knows how they can execute their work in lucrative form.
 Further, top management team of Bufori is also suggested to conduct few meeting
sessions for their employees where they can easily express their problems or issues with
their respective colleagues or top management team. This would definitely provide
support to employees to express themselves in front of the related people and get desired
solution for the same in appropriate form. This would directly boost up performance of
the employees as they are getting better environment to work freely. This will simply
support company in attaining success in UK in faster manner.
 At last, it is suggested to superior management team of this company to take some
experienced staff of Malaysia to UK who would handle management in UK too. Here, the
new top management team is also required to include few localize and experienced
employees of UK too. The main reason behind including both nationality people in the
expansion project of Bufori as it will allow them to make better decision in the new
country with new people. Inclusion of Malaysian existing top management team will
expansion project executing the work effectively with their past policies. On the other
hand, inclusion of UK staff in the management team will help the same company in
taking decision according to the UK market and needs and requirement of their people
too. As a result, it would be easier for the same company in attaining success in UK
within the same sector.
By incorporating all of these recommendations within the company, management team of
the company will be able to attain success in quicker manner as it will allow them in executing
their work in rightful manner.
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REFERENCES
Books and Journals
French, R., 2015. Cross-cultural management in work organisations. Kogan Page Publishers.
Gehrke, B. and Claes, M. T. eds., 2014. Global leadership practices: A cross-cultural
management perspective. Macmillan International Higher Education.
Johnson, J. L. and Cullen, J. B., 2017. Trust in cross‐cultural relationships. The Blackwell
Handbook of Cross
‐Cultural Management, pp.335-360.
Moore, F., 2015. An unsuitable job for a woman: a ‘native category’approach to gender,
diversity and cross-cultural management. The International Journal of Human Resource
Management. 26(2). pp.216-230.
Patel, T., 2013. Cross-cultural Management: A transactional approach. Routledge.
Thomas, D. C. and Peterson, M. F., 2016. Cross-cultural management: Essential concepts. Sage
Publications.
Thomas, D. C., 2015. Cultural intelligence. Wiley Encyclopedia of Management, pp.1-3.
Tran, B., 2016. Communication (intercultural and multicultural) at play for cross cultural
management within multinational corporations (MNCs). In Handbook of research on
impacts of international business and political affairs on the global economy (pp. 62-92).
IGI Global.
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