International Business Communication: H&M's Approach in Indonesia

This report delves into the international business communication strategies employed by H&M, a Swedish multinational clothing company, as it expands its operations into developing countries, with a specific focus on Indonesia. It provides an overview of Indonesia as a developing country, highlighting its potential benefits for H&M's business model due to lower labor costs. The report applies theories of international and intercultural communication, such as Hofstede's cultural dimensions, to analyze cultural differences between the United Kingdom (where H&M has a significant presence) and Indonesia, focusing on power distance, individualism vs. collectivism, uncertainty avoidance, masculinity vs. femininity, and long-term orientation. It critically evaluates the importance of cultural sensitivity for H&M in navigating the Indonesian market, emphasizing the need to respect local values and beliefs. Furthermore, the report discusses communication barriers, including linguistic and psychological factors, that H&M may face in Indonesia and recommends communication strategies, such as visual and oriented communication, to overcome these barriers and achieve success. The report concludes that effective business communication is crucial for H&M to expand its business practices in diverse cultural contexts and generate profits.

International Business
Communications

Table of Contents
Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Overview of developing country..............................................................................................1
Applications of theories of international and intercultural communication.......................2
Critical evaluation of cultural sensitivity while carrying business in developing country.3
Discussion of communication barriers that are faced by foreign businesses in developing
country.......................................................................................................................................4
Communication strategies and recommendations for enabling company to succeed in
developing country....................................................................................................................5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
International business could be referred to a process where product as well as services are
traded in international global boundaries. It is related with transactions of global cross-border
operations in which trading practices are performed between different countries (Solihati, 2021).
With international business there are major factors which are associated to culture as well as
business strategy could be developed so that effective business practices in market skills could be
performed. Along with business communication is necessary for carrying out international
business practices to get succession and growth opportunities for conveying product and services
of company to associated customers (Almeida and Campos, 2021). This report is based on
international business communications of H&M which is Swedish multinational clothing
company which is well known for selling its fast fashion clothing for different age groups. This
report consists of introduction to developing country, theories of international and cultural
communication, cultural differences, communication barriers and communication strategies
along with its conclusion.
MAIN BODY
Overview of developing country.
For a business in present time, expanding business practices is different countries are
generally required to be carried of different insights through which higher market prominence
could be achieved by them. As in order to expand business practices with higher development it
is necessary for companies to use communication which plays an important role for increasing
global success in order to carry their business relationship with different countries. In relation to
H&M for carrying out business practices in a developing country which is Indonesia it is
essential for company to use business communication to carry their international business
practices is a country in South Asia (Tung, 2021). As being a lower middle class country and
member of G20 Indonesia is being classified as industrialised developing country. So it will be
beneficial for H&M to carry its business practices as they could have supply power with labour
on cheap cost. As company is premium based where there bargaining power of customers could
be high but supplier should be at low price.
1

Applications of theories of international and intercultural communication.
As international communication that is any type of symbolic interaction which is carried
between individual of different countries. Intercultural communication arises in among
individuals and different culture where cultural values are considered to be major factor in nature
of interacting and determining outcomes in market. In relation to H&M in order to carry business
practices at international level of developing country like Indonesia some of theories of
international and intercultural communication could be used for having an understanding of
culture. In order to run business practices application of Hofstede cultural theory that could
identify cultural factors are explained as follows:
 Power distance index: As per this element power culture factor keeps an emphasis on
where society accept unequal distribution of democracy, power as well as individuals in
order to understand their places in their system (Conroy and McCarthy, 2021). For that
there is being business practices which is carried between United Kingdom and Indonesia
for score. So in terms of United Kingdom business score is low and score of United
Kingdom in power index is 35 that means that this society is not having freely engaged
and accepted towards an equal power of distribution. So H&M is having functional
organisation structure that becomes crucial for them in perspective of Indonesia which is
caring score of power index is 78 that deals in extremely high level of hierarchy in their
business practices.
 Individualism and collectivism: This element carry Street where individuals are more
self-centred as well as less reliable for carrying their actions. Whereas collectivism team
working that is supported and individuals of society for carrying their work. As in United
Kingdom it carries score of around 89 that represents that individualist carries company
culture in United Kingdom effective that personal life and goals are to be performed with
happiness. In terms of Indonesia countries having low collectivism society approach.
That represents that there is higher preference of having strongly deferred social
framework through which individuals are expected to confirm about their ideals of
society and group through which they belong.
 Uncertainty avoidance: This element of culture theory states that United Kingdom is
having open culture of innovation in their business practices and they are effective by
engaging towards inclusive working. But in view of carrying out business practices in
2

Indonesia they are having low preference and having neglecting of business practices that
could result in having low productivity of company.
 Masculinity and femininity: This element of cultural theory is similar to United
Kingdom and Indonesian market in the presenting their high degree of masculinity which
represents that money as well as culture is considered to be a main priority for their
individual. As United Kingdom and Indonesia are having better oriented goals of
working towards your success. In relation to Indonesian market there is high masculinity
on the dimension which represents through society that will bring up by competition,
success and achievement. And in perspective of developing country like Indonesia is
having low dimension that represents that they are dominating their values in society in
terms of gender roles. In that case it becomes difficult for H&M to carry their business
practices with male employees.
 Long and short term orientation: This element presents that there is moderate degree of
working that represents that individuals that have behaviour programmatic as well as
normative their objective that could result in having effectiveness (Mehra and Mishra,
2021). In relation to Indonesian market country is indicating their support to pragmatic
culture that deals in using practical theories of working in their society where individuals
and companies could believe on truth that is dependent with higher situation context of
time.
 Restraint indulgence: As culture of United Kingdom is indulged with better performance
of company by showing their gratification towards emotions with employees. Indonesian
perspective that represents that they are having low gratification which has been showed
in their culture which represents that H&M could face cultural barriers in terms of
emotional negligence towards their customers in terms of selling their clothing.
Critical evaluation of cultural sensitivity while carrying business in developing country.
Cultural sensitivity is defined to a term which implies related to cross cultural awareness
that is understandable, knowledgeable along with having proper awareness that is related to
understanding of culture of different countries with their values (Presbitero, 2021). It is essential
for companies that are carrying their expansion in different countries in international market to
understand their cultural awareness by having joint venture that is important to have a deep
insight about effective cultural sensitivity. This condition carries due to lack of knowledge which
3

could result to damage in sentiments of other individuals by carrying out business practices when
they are not able to understand their beliefs. Hence in order to avoid any type of negative
consequences in business expansion for carrying out practices in developing country like
Indonesia, H&M could make joint venture with different countries that are present in country in
order to understand its culture and have knowledge about their working. As culture of Indonesia
is very sensitive and it is essential for company to adapt and respect their values by developing
their cultural sentiments in terms of designing their clothing that could harm to their beliefs
(Yekini, Omoteso and Adegbite, 2021). As usually Indonesia is following culture of Buddhism,
Hinduism Christianity as well as Islam that is all strong with their major trading cities. There is a
huge relevance of privacy and ethical business operations which could be carried by company in
order to have a careful prevention with better individual through dignity and respect.
Discussion of communication barriers that are faced by foreign businesses in developing
country.
Communication barriers is common in in companies which is faced by them at time of
planning as well as operating in international marketing. As for that base of communication
barrier could be able to accept is linguistic, cultural as well as psychological. So there is
difficulty which is faced by H&M when they are entering their business practices into
developing country of Indonesia with their retail business that could be lined up through
collaboration. Therefore, it is essential for company to identify communication barrier while
expanding their business practices in Indonesia. In relation to H&M different communication
barrier which is faced by company while working in developing country of Indonesia are as
follows:
 Linguistic barrier: This barrier status about difference in language of nation which is
being face as a barrier of communication. As company is facing this communication
barrier by having large communication difference among United Kingdom and Indonesia
language (R’boul, 2021). In Indonesia they are using common language and United
Kingdom is using with British language that is English so in that case it becomes difficult
for H&M to understand requirements of customers and promote their product.
 Physiological barrier: This barrier deals in difference in perception and way of thinking
of individuals and society of different countries which is said to be a barrier that is faced
by companies while expanding their business practices in Indonesia. As there is
4

perception of affordable as well as reasonable cost clothing which is good looking rather
than focusing on quality of clothes. Whereas United Kingdom is focusing on quality of
clothes. So it is difficult for H&M to convey their demands and requirements towards
customer with lower price.
Communication strategies and recommendations for enabling company to succeed in
developing country.
Innovative communication strategy is basically defined to manners that could mitigate
barriers as well as challenges of communication which could be employed as a sense of different
strategies by filling up differences of communication that are faced by company (Tagliacozzo,
Albrecht and Ganapati, 2021). In order to resolve communication barriers while expanding
business practices in developing country like Indonesia it is necessary for H&M to use different
communication strategies in their business practices for having a focus on competitive market
place by maintaining proper working surroundings which is flexible and open to communicate
with customers. As some of communication strategies that are recommended to H&M order to
establish their position and gain success are as follows:
 Company is recommended to implement upward use of visual communication strategies
that could be beneficial for company to convey effective use of digital visual
communication strategy. This is strategy could be used by H&M to convey their
messages to their employees in terms of their clothing showcase.
 H&M should use oriented communication strategies in their business practices that could
be beneficial for them to keep their employees focused on their work. It is recommended
to use internal lateral communication by implementing various channels like voice calls,
messages, emails and so on. In order to sell their clothing products company is
recommended to promote their product with effective strategy that could require less
efforts in explaining to customers about their message an idea of product that could be
carried through using oriented communication strategy (Chiuswa and Sibanda, 2021).
 Company is recommended to use different tools that could be help in improving their
communication channels and they could be able to establish their marketplace in
Indonesian market for longer term.
5

CONCLUSION
It could be concluded from above report that international business is beneficial for
companies to expand their business practices in different countries for generating profits. Along
with it is necessary for companies to use business communication in their business in order to
expand their business practices in different countries for having and ease of understanding
various aspects for running business. This report explains about carrying out business practices
in a developing country where different aspects are to be present there and according certain
strategies which could be used as a type of communication for having effective expansion of
company explained in a well manner for generating profits for company.
6

REFERENCES
Books and Journals
Almeida, S. and Campos, A.C., 2021. New avenues for business competitiveness: the case of a
community of practice in the hotel sector. International Journal of Culture, Tourism
and Hospitality Research.
Chiuswa, L. and Sibanda, A., 2021. The Use of a WhatsApp Record for Communication With
Students: A Case of the Zimbabwe Open University, Mashonaland West Campus.
In Handbook of Research on Information and Records Management in the Fourth
Industrial Revolution (pp. 310-325). IGI Global.
Conroy, K.M. and McCarthy, L., 2021. Abroad but not abandoned: supporting student
adjustment in the international placement journey. Studies in Higher Education .46 (6).
pp.1175-1189.
Mehra, P. and Mishra, A., 2021. Role of Communication, Influence, and Satisfaction in Patient
Recommendations of a Physician. Vikalpa, p.02560909211027090.
Presbitero, A., 2021. Communication accommodation within global virtual team: The influence
of cultural intelligence and the impact on interpersonal process effectiveness. Journal of
International Management .27 (1). p.100809.
R’boul, H., 2021. North/South imbalances in intercultural communication education. Language
and Intercultural Communication .21 (2). pp.144-157.
Solihati, K.D., 2021. READINESS OF INDONESIA TELECOMMUNICATION BUSINESS
INCUMBENT IN FACING DISRUPTION ERA. PalArch's Journal of Archaeology of
Egypt/Egyptology .18 (08). pp.2476-2487.
Tagliacozzo, S., Albrecht, F. and Ganapati, N.E., 2021. International Perspectives on COVID-19
Communication Ecologies: Public Health Agencies’ Online Communication in Italy,
Sweden, and the United States. American Behavioral Scientist .65 (7). pp.934-955.
Tung, V.W.S., 2021. Reducing tourist stereotyping: Effectiveness of communication
messages. Journal of Travel Research .60 (2). pp.281-292.
Yekini, K.C., Omoteso, K. and Adegbite, E., 2021. CSR communication research: A theoretical-
cum-methodological perspective from semiotics. Business & Society .60 (4). pp.876-
908.
7