Cross-cultural risk: A situation or event where a cultural miscommunication puts some
human value at stake. It arises in environments comprised of unfamiliar languages, and
unique values, beliefs, and behaviors.
Socialization: The process of learning the rules and behavioral patterns appropriate to
Acculturation: The process of adjusting and adapting to a culture other than one's own;
commonly experienced by expatriate workers.
High and low context cultures: High context cultures such as Chinese, Korean, and
Japanese establish social trust first, negotiations are slow and ritualistic, and
agreements emphasize trust. Low context cultures such as German, Swiss, and North
American get down to business first, negotiations are as efficient as possible, and
agreements emphasize specific, legalistic contract.
Building & Sustaining a Competitive Advantage
Lower the cost of the firm's operations and activities on a global scale.
The agility to manage diverse country-specific risks and opportunities by
tapping resources in individual countries and exploiting local opportunities.
Develop the firm's products, technologies, capabilities, and skills by
internalizing knowledge gained from international ventures.
Global team - An internationally distributed group of employees charged with a specific
problem-solving or best practice mandate that affects the entire firm.
Global information systems - Global IT infrastructure, together with tools like intranets
and electronic data interchange, provides virtual interconnectedness within the
Multi-Domestic Industry - An industry in which competition takes place on a country-by-
Global Industry - An industry in which competition is on a regional or worldwide scale.
Global Integration - Coord
ination of the firm's value
-chain activities across multiple
countries to achieve worldwide efficiency, synergy, and cross-fertilization, to take
advantage of similarities between countries.
Seek cost reduction thru economies of scale - Concentrating manufacturing in a few
advantageous locations achieves economies of mass production.